Gold is trading lower even as the U.S. dollar index tumbles and Treasury yields edge lower after the ADP employment report showed just 77,000 private-sector jobs added in February, well below forecasts of 140,000. The 10-year Treasury yield has dipped, reducing the opportunity cost of holding non-yielding assets like gold and silver.
Typically, a weaker dollar and lower yields would support gold prices, but today’s sell-off suggests that some traders are taking profits after gold’s recent strength. Gold remains above key support at $2,895.29, with stronger downside levels at $2,864.26 and $2,843.43. A break below $2,832.72 could accelerate selling pressure, while resistance remains near $2,910.32.
ADP Report Raises Rate-Cut Speculation
The weak ADP jobs report has intensified speculation that the Federal Reserve may move toward cutting rates sooner than expected. The report highlighted job losses in trade, transportation, utilities (-33,000 jobs), and education and health services (-28,000 jobs), signaling broader economic weakness. Small businesses struggled, reporting a net loss of 12,000 jobs, underscoring rising economic pressures.
Despite weak hiring, wage growth held steady at 4.7% annually, which could keep inflation concerns in focus. The nonfarm payrolls report on Friday will be the next major data point, with traders watching closely for any signs that labor market weakness is accelerating.
