Gold Surges as Disappointing Nonfarm Payrolls Weigh on US Dollar

The US economy lost 23K jobs in July, falling short of market expectations of an 80K increase. The disappointing nonfarm payrolls report weighed on the US Dollar (USD) and US Treasury yields, causing gold prices to rise.

XAU/USD is trading around $4,368, its highest level since June 17. The precious metal is heading for its strongest weekly rise since January, gaining over 8% so far.

Technical analysis suggests that the Relative Strength Index (RSI) at 66 approaches overbought territory on the daily chart. However, a sustained break above the 100-day SMA at $4,390 would open the way for a more decisive bullish continuation.