Non-agricultural increase to 460,000, but it is hard to beat the US CPI to hit a new high next week!

This week, gold and silver are running as expected in our weekly review. During the weekly review, I will focus on reminding everyone to pay attention to the turning point on the 31st. It is expected that after the low point, the overall outlook will continue to be around the 8th. And I also remind everyone that gold and silver are easy to fall and hard to rise this week. Although the 31st rebounded after the low point as expected, the overall situation was a weak and volatile rebound, and there were several rapid and sharp declines in the middle, although the decline finally stopped. A rebound, but in the middle, let us lay out a small bull in the band, and it is also a case of no success. From the perspective of fundamentals this week, the reasons for this week's upward volatility are as follows:

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1. The possibility of the Fed raising interest rates sharply in March is reduced, and Fed officials emphasized that they will not hit the brakes on the economy.

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2. At present, the market generally expects the Fed to raise interest rates at least four times this year to curb rising inflation. JPMorgan expects up to five rate hikes this year, while some companies such as Bank of America expect up to seven.

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3. The change in non-farm employment in the United States in January increased by 467,000, far exceeding the expected increase of 125,000. The previous value was significantly revised up from an increase of 199,000 to an increase of 510,000; the average annual rate of hourly wages in the United States in January increased by 5.70%, which is also far Higher than the expected value of 5.20% and the previous value of 4.70%.

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4. The environment of the Fed raising interest rates and the rising dollar restrained the rise of gold prices.

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Non-farm payrolls increased to 460,000, but it is hard to keep up with the US CPI hitting a new high next week! Where will gold go?

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The above factors are the core that causes gold and silver to continue to oscillate upward, and in the middle, there is a trend of bottoming out and rebounding after two sharp downturns. The operation of this week is still in accordance with the previous expectations. First, the short positions such as 1810 to 1813 were completely flattened here at 1801, and then the long positions such as 1790 and 1793 continued to be deployed. When the non-agricultural economy stopped falling and rebounded after the decline, it further held at 1797. Therefore, if you want to eat big meat in a swing, you also have to bear the troubles caused by the fluctuations in the middle and the situation of withdrawing profits, so what we do is to lighten up positions and set up guarantees to bet, or stop losses to bet for bigger profits. I have always emphasized, A good trader not only depends on the ability to make money in good times, but also depends on the risk control in adversity. This is the key to making money in the end!

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Data to focus on next week:

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At 21:30 on the 10th, the annual rate of the US CPI in January was not seasonally adjusted (%) at a high of 77.3

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21:30 The number of people applying for unemployment benefits in the United States in the week ended February 5 (ten thousand) was 23.8 high

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At 23:00 on the 11th, the initial value of the consumer confidence index of the University of Michigan in February was 67.267.3 high

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On the news, the holiday will end, but for us financiers, as long as there is a transaction, it is normal to go to work, and money never sleeps. Today is the last day, I wish you all a safe journey on the way back. The non-farm payroll just ended this week, so next week's news will be relatively light compared to this week, but there are still several core data to focus on, including: China's Caixin service industry PMI, German industrial output, US 1 Monthly CPI, UK GDP, etc. The core is the CPI data of the United States in January. Recently, expectations of the Fed raising interest rates are rampant, and the Fed raising interest rates is likely to be a last resort, because US prices have soared, which has hit a new high in nearly 40 years. In December 2021, the U.S. CPI and core CPI increased by 7% and 5.5% year-on-year, respectively. People tend to think that as long as prices are high, interest rates should be adjusted. Judging from the current situation, in order to stabilize inflation expectations and maintain the Fed's own credit, the Fed has to put interest rate hikes on the agenda. Prices are mainly affected by the effects of both supply and demand. Most of the CPI rises in U.S. history have been caused by overheating demand, and in this case, raising interest rates can dampen demand and thus quell inflation.

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However, the reasons for the high prices in the United States this time are different from those in history. The demand side of the United States this time is normal. First, the U.S. stopped the national subsidy in September 2021, but then the CPI has been getting higher and higher, which means that the continued increase in the CPI has nothing to do with the national subsidy; second, the U.S. unemployment rate fell to 3.9% in December, but labor participation The rate is about 0.8 percentage points lower than the normal year before the epidemic, which means that the number of non-agricultural employment is not high, and the income of American residents is unlikely to increase significantly; third, the rise in asset prices in the United States brings wealth effect, but the impact limited to the consumer side. From all aspects of analysis, the demand side of the United States is normal and not overheated. So why are prices going up? The new crown epidemic has hit the US supply chain, causing supply shortages and rising costs to be the core issues. Therefore, the key to the later stage is production recovery and cost reduction to alleviate. From the perspective of expectations, it may break the record again to 7.3%. If it is higher, it will be a small bullish gold first, and then it is expected to be bearish. The core key is the rise of gold under inflation, but the acceleration of inflation will definitely lead to further interest rate hikes. suppress. Therefore, it is difficult to judge how to go, and we can only further look at the trend and redefine it.

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In addition, we still need to pay attention to the progress of the Fed's interest rate hike expectations, the progress of the global anti-epidemic, and the speeches of Fed officials. And this cannot be accurately predicted, and we can only watch it while walking. The core of the development of the epidemic is to see whether the changes in the daily increase in confirmed cases further exceed 3 million people, and the increase or decrease of the data in the United States. Decline, but see if there are further changes in the later period, if the overall rise is also bullish for gold and silver.