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Published: 3 July 2026,06:23
Daily Market Analysis New
*US dollar retreats sharply after weaker-than-expected Nonfarm Payrolls data
*June payrolls rose only 57,000, well below market expectations of 110,000
*Gold extended gains as softer labor data supported demand for the precious metal
The Dollar Index, which tracks the greenback against a basket of six major currencies, retraced sharply after the latest U.S. jobs report came in much weaker than expected. The disappointing data prompted investors to reassess whether the Federal Reserve still has enough economic support to justify further rate hikes in the near term.
According to the Bureau of Labor Statistics, U.S. Nonfarm Payrolls increased by only 57,000 in June, significantly below market expectations of 110,000. Meanwhile, the unemployment rate edged lower to 4.2%, broadly in line with expectations. Despite the stable unemployment rate, the sharp slowdown in hiring raised concerns that momentum in the U.S. labor market may be weakening.
The weaker payrolls report, combined with the recent decline in oil prices, reduced market expectations that the Fed may need to tighten monetary policy further to fight inflation. As rate hike bets eased, U.S. Treasury yields dropped, adding further pressure on the dollar.
This softer dollar and lower-yield environment provided support for gold. The precious metal held two days of gains as investors reduced expectations that the Fed would raise interest rates at its next policy meeting in July.
Gold tends to benefit when Treasury yields fall, as lower yields reduce the opportunity cost of holding non-yielding assets. At the same time, a weaker dollar makes dollar-denominated gold more attractive to foreign buyers, helping improve demand.
Overall, the weak jobs data shifted market focus back toward slowing growth risks and a less aggressive Fed outlook. Unless upcoming U.S. data rebounds strongly, the dollar may remain under pressure, while gold could continue to find support from lower yields and reduced rate hike expectations.
Technical Analysis
Dollar Index, H4:
The dollar index is trading lower after breaking below the previous 100.95 support level, signaling a bearish shift in short-term structure.
Momentum indicators remain tilted to the downside, with the MACD showing increasing bearish momentum and the RSI at 35 staying below the midline, suggesting that selling pressure may persist.
If bearish momentum continues, the index could extend losses toward the next support at 100.10, which also aligns with the upward trendline. Further downside may expose 99.50.
However, if bearish momentum begins to fade, the index may stage a technical rebound and retest the 100.95 resistance level, followed by 101.80 if recovery strengthens.
Resistance Levels: 100.95, 101.80
Support Levels: 100.10, 99.50
GOLD, H4:
Gold prices are trading higher, currently testing the 4,205.00 resistance level, which acts as a key near-term breakout zone.
Momentum remains supportive, with the MACD showing increasing bullish momentum and the RSI at 71 entering overbought territory, suggesting strong upside pressure but also raising the risk of a near-term technical correction.
A confirmed breakout above 4,205.00 could extend gains toward the next resistance at 4,350.00, reinforcing the bullish structure.
However, if bullish momentum fails to sustain, gold may retrace and retest the 4,085.00 support level, followed by 3,960.00 if selling pressure increases.
Resistance Levels: 4205.00, 4350.00
Support Levels: 4085.00, 3960.00
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