Anyone who follows gold knows there’s usually a negative bias towards it as the monthly employment release nears. Given a rather bearish technical pattern at the moment (bearish flag pole), tomorrow’s employment release can be the ignition to the next $100 or so move in gold’s price.
A break below the pennant and it’s a near certainty IMHO we see a test of the critical $1,000 area. Given how incredibly bearish and overcrowded the bearish camp is at the moment, I think such a test would fail and a break below $1,000 would follow. Only then would the crowd begin to take profits.
However, if the employment number is significantly weaker than expected, I suspect we could a dramatic short-covering rally that could signal the climatic end of this nearly 4-year old bear market.