Gold price remains unchanged at $1,740 as bulls seek direction

Call it a literal "Goldilocks" scenario. Goldilocks does not relate to an ideal economic state in which things are neither increasing or shrinking excessively; rather, it relates to the fact that gold is nearly stuck around $1,740 per ounce while traders seek to discern the yellow metal's path.

Gold futures for delivery in August on the New York Comex climbed $2.60, or 0.2 percent , to $1,742.30 per ounce. It declined 3,3 percent for the week, its fourth straight fall since the week ending June 10. The current week's fall was also the most severe since the week ending May 6.

Despite the terrible weekly figures, gold has experienced some resistance since Wednesday's 10-month low of $1,730.70. Gold for August delivery on the Comex has hardly moved above or below $1,740 since reclaiming ground from that level.

According to others, this means that gold may have already reached, or is close to reaching, its lowest point and likely has no further to go.

Gold trade on Friday was affected by increasing uncertainty after the revelation of good June employment numbers from the United States.

The Labor Department announced that U.S. firms created 372,000 jobs last month, which was about 100,000 more than what analysts had projected, while the unemployment rate stayed at 3.6 percent for the third straight month. Later, from the White House, President Joe Biden reported that the United States has restored all 20 million jobs lost during the coronavirus pandemic outbreak in March and April 2020.

Theoretically, such findings seemed good for the U.S. economy. It was not, however, in the present inflationary situation, where the Fed wants the red-hot job market and wage growth to subside in order to diminish Americans' need for things.

For gold, there was an additional complication: the Federal Reserve had already planned to boost interest rates by 75 basis points in July, as it did in June. Would the Fed be willing to take additional action if the fed funds rate continues to price in a 75 basis point hike for July on Friday? Or will the other three probable rate hikes this year be 75 basis points or higher?

"The short end of the yield curve signals that the Federal Reserve has the green light to tackle inflation vigorously, while the long end indicates that a recession is imminent," said Ed Moya, an analyst at the online trading platform OANDA.