GOLD, US DOLLAR, S&P 500 INDEX PRICE ANALYSIS – MARKET RESPONSES TO JULY 2020 NFP REPORT:
- July 2020 NFP[1] data topped market consensus as the US unemployment rate ticks lower to 10.2%
- Net change in nonfarm payrolls crossed the wires at 1.7-million job gains while wages increased
- Gold price[2] action edged lower as the US Dollar[3] jumped, S&P 500[4] Index whipsawed in response
Markets are currently weathering what seems to be a volatile trading session. This comes as little surprise, however, considering the latest release of nonfarm payrolls data for July 2020 just crossed the wires. The monthly US jobs report has a history of sparking price volatility[5] as traders react to the generally high-impact employment figures.
NFP Report – July 2020 Nonfarm Payrolls (Chart 1)
Chart Source: DailyFX Economic Calendar[6]
July 2020 NFPs shows that the US economy continues to add jobs after the catastrophic collapse in NFPs[7] earlier this year owing to the coronavirus lockdown. The headline net-change in nonfarm payrolls was reported at 1.76-million jobs added, which compares to the median economist estimate looking for 1.6-million jobs. The US unemployment rate declined further to 10.2% from the prior 11.1% reading, but the pace of job gains seems to have slowed notably.
GOLD, US DOLLAR, S&P 500 PRICE REACTIONS TO JULY 2020 JOBS DATA (CHART 2)
Chart created by @RichDvorakFX[8] with TradingView[9]
The US Dollar was trading quite higher against major FX peers[10] in the hours and minutes headed into the NFP report[11] release. Meanwhile, the influx of US Dollar strength appeared to be weighing negatively on gold price action. Following the monthly jobs
