Forexpros – Gold prices soared to a near four-week high in early U.S. trading Friday on the heels of disappointing jobs figures that sparked talk of Federal Reserve intervention in the U.S. economy.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded up 3.21% at USD1,614.45 a troy ounce.
Gold hit at a low of USD1,546.35 a troy ounce and a high of USD1,619.25 a troy ounce during the session.
Gold futures were likely to test support at USD1,546.35 a troy ounce, the earlier low, and resistance at USD1,642.95, the high from May 07.
The U.S. economy added a net 69,000 nonfarm payrolls in May, far beneath expectations for gain of about 150,000.
The headline unemployment rate, meanwhile, rose to 8.2% in May from 8.1% in April, sparking talk the Federal Reserve may feel obliged to intervene and stimulate the economy via quantitative easing, which are asset purchases from banks that flood the economy with liquidity.
Quantitative easing send the dollar weakening as a tradeoff for price stability and also for conditions that encourage hiring, and a weak dollar normally sends gold rising.
Gold has fallen in recent sessions amid concerns the European debt crisis has been escalating, which has fueled demand for the yellow metal’s hedge, the greenback.
The Friday jobs report sent the metal soaring, as the asset was attractively priced before talk of monetary easing spread through the markets.
Elsewhere on the Comex, silver for July delivery was up 2.87% and trading at USD28.555 a troy ounce, while copper for July delivery was down 1.03% and trading at USD3.331 a pound.
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