Dollar Slides Ahead of Delayed U.S. Jobs Data; Gold Volatile as NFP Looms

Key Takeaways:

*Dollar weakens as markets await delayed U.S. employment data following the shutdown

*October–November NFP seen as critical for reassessing Fed policy expectations

*Gold trades volatile near record highs as investors hedge ahead of data risk

Market Summary: 

The U.S. dollar extended its decline against a basket of major currencies as investors positioned cautiously ahead of long-delayed U.S. labor market data, expected to be released later this week. Focus is squarely on the combined October and November employment reports, which are seen as pivotal in shaping expectations for the Federal Reserve’s next policy move.

The longest government shutdown in U.S. history disrupted the collection of key economic indicators, including October’s non-farm payrolls and unemployment data. The Bureau of Labor Statistics confirmed that no household survey was conducted in October, preventing the calculation of the unemployment rate, while establishment data used for payrolls were also delayed. As a result, markets have been operating with an incomplete picture of labor market conditions for more than a month.

The forthcoming jobs reports are expected to offer the first meaningful read on whether U.S. labor demand is cooling in response to tighter financial conditions and earlier policy easing. Any signs of weakening payroll growth or rising unemployment could reinforce expectations that the Fed will continue cutting interest rates early next year. Recent rate reductions have already pressured the dollar, and traders remain wary of rebuilding long positions ahead of potentially volatile data.

Gold prices, meanwhile, have been caught in wide swings as investors seek protection against data-driven market moves. The precious metal rebounded sharply toward record levels on heightened uncertainty, supported by a softer dollar and falling real yields. However, prices retreated on profit-taking as markets braced for the possibility that the jobs data could surprise the upside, triggering a reassessment of rate-cut expectations.

With the delayed NFP report expected to carry greater-than-usual significance, markets are likely to remain fragile. A decisive shift in labor market momentum could set the tone for both the dollar and gold into year-end, as investors recalibrate expectations for U.S. growth and Federal Reserve policy.

Technical Analysis

DXY, H4: 

The Dollar Index is trading lower after retreating from the key resistance level at 98.55, and is currently testing the 98.10 support zone. This level remains critical for near-term direction. A confirmed break below 98.10 would likely expose the index to further downside toward the next support at 97.55, reinforcing the broader bearish bias.

Momentum indicators remain tilted to the downside. MACD shows diminishing bullish momentum, while the RSI at 33 remains below the midline, suggesting downside pressure is still present. That said, should bearish momentum fail to extend, a technical rebound cannot be ruled out, with prices potentially re-testing resistance at 98.55.

However, technical signals may take a back seat in the near term, as the dollar’s direction is likely to be driven by crucial U.S. economic data due later today, particularly the U.S. jobs report. A strong surprise could trigger a rebound, while weaker-than-expected data may accelerate losses.

Resistance Levels: 98.55, 99.05

Support Levels: 98.10, 97.55

GOLD, H4: 

Gold prices are trading lower after pulling back from the recent record high near 4,350.00, as profit-taking emerges ahead of key U.S. data. Bearish momentum has started to build, with MACD showing increasing downside pressure. Meanwhile, the RSI at 53 has retreated sharply from elevated levels, signaling a loss of upside momentum.

If bearish pressure persists, gold may extend its pullback toward the next key support zone at 4,260.00, followed by 4,175.00. A sustained break below these levels would suggest a deeper corrective phase is unfolding.

On the other hand, if downside momentum fades, gold could enter a consolidation phase before attempting another rebound. A recovery back above resistance at 4,350.00 would re-open the path toward the psychological 4,500.00 level.

With major U.S. economic data due later today, gold is likely to see heightened volatility. A clear break above resistance or below support following the data release should provide stronger directional signals.

Resistance Levels: 4,350.00, 4,500.00
Support Levels: 4,260.00, 4,175.00