It sounded almost like one of those allegations of manipulation you commonly hear in gold — only this time, those making the accusation were gold bears, not bulls (GOLD FLYING). Gold had its best percentage win in 2-½ years on Friday as the hedge funds that typically hammer the yellow metal at any given opportunity gave it surprising love instead after the monthly U.S. jobs report again overshot expectations — a situation that would normally benefit the dollar rather than gold.
The Dollar Index, which pits the greenback against the euro, yen, pound, Canadian dollar, Swedish krona and Swiss franc, dropped to below 111 at Friday’s low despite the United States adding 261,000 jobs last month in its October non-farm payrolls report, almost 35% more than the 195,000 anticipated by economists. Just a day ago, the index hit a three-week high of 113.035.
Dollar Plunges in Rare Pivot After Heady U.S. Jobs Report
U.S. gold futures settled Friday’s trade up 2.8% as the benchmark December contract finished up $45.70 at $1,676.60 per ounce on New York’s Comex. Investing.com data showed it was the biggest percentage win for gold in a day since April 2, 2020, when the benchmark contract then rose 2.9%. On a weekly basis, December gold rose 1.9% for its best week in four.
The job numbers simply don’t justify what’s happened to the dollar and gold(Gold flying)” ,who projects that the Dollar Index should be at around 114 instead and spot gold to be possibly under the previous session’s five-week low.
The whales in the hedge fund game are clearly manipulating both the dollar and gold, though this time, gold is benefitting Gold commentator Mark Hulbert also appeared to think the rebound wouldn’t last. In his opinion, Hulbert said the yellow metal had to have a complete meltdown before it could rise again from its ashes, not unlike the proverbial phoenix.
“Long-suffering gold bugs will likely have to suffer a while longer,”
Hulbert wrote in a blog that appeared on MarketWatch. “That’s because gold traders on the whole have not thrown in the towel and thereby given up on the yellow metal. Only when this so-called capitulation occurs will contrarians be confident that a bottom is at hand. Though there have been several occasions this year when it appeared that capitulation was imminent, gold traders stepped back from the cliff every time.”