Gold is holding strong in the 5000-5100 zone and, despite the dollar’s bullish reaction to yesterday’s jobs data, is still making higher lows.

The economy created 130,000 new jobs in January according to the latest jobs report released yesterday, beating 79 of the 80 estimates in Bloomberg’s survey. 124,000 of the new payrolls came from healthcare. Although highly concentrated, the report was strong. The unemployment rate fell to 4.3% from 4.4% despite a rise in labor force participation. The 2024-2025 downward revisions were large but not far from estimates, so the negative revision was already priced in.

Earlier in the month, top government sources warned that employment would weaken in the coming releases, so the better-than-expected data had a stronger impact on the dollar index.

(Gold)

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Despite the dollar’s strength, gold has remained resilient, continuing to make higher lows in both the short term and medium term. Iran risks may be one of the contributors to the upside pressure. The oil market is clearly pricing in US strike risks despite Trump favoring negotiations.

While the lows are higher, the upside remains capped by 5100 resistance, forming an ascending triangle that tends to break upward most of the time. 5100 is the main resistance, but 5140 could potentially act as a higher resistance level as well. If broken, gold might move toward the 76.4% retracement level in the coming days.

For possible downward moves, 5038 and 5000 are the first two key support levels to watch in the short term.