Gold miners set to report earnings

Gold Prices Sink on Jobs Report as Miners Ready to Report Earnings

By:Thomas Westwater

Gold Falls After NFP Report but Event Risk Lies Ahead

Gold prices (/GC) had a positive reaction following the U.S. central bank’s latest policy announcement, but the good times didn’t last long for the yellow metal. The U.S. non-farm payrolls report (NFP) surprised estimates on Friday, causing dovish market bets on the Fed’s rate path to unravel. That sent bullion prices nearly 3% lower on Friday, extending a move from Thursday that wiped out early-week gains.

That was the largest weekly drop for gold prices since October, and the move has nearly trimmed its January gain when the metal rose 6.5% by more than half. Bond traders ditched Treasuries after the jobs report showed that a historically aggressive rate hike cycle failed to slow hiring. Still, the S&P 500 recorded a healthy 1.5% gain for the week. Equity traders are perhaps taking a more optimistic outlook on pushing through further rate hikes—but rate traders are taking a different view.

The economy is still losing steam, evidenced by other economic metrics like weak purchasing managers’ indexes and depressed consumer confidence. That said, Treasury yields may resume their downtrend once traders move past Friday’s report. There is an argument to make that the jobs market should slow in the coming months and that January’s report—typically subject to large seasonal adjustments—could be a one-off surprise. If that plays out, gold should resume its uptrend.

Trading Gold Price Action in the Weeks Ahead

The current pullback provides a buying opportunity for those holding onto the long thesis for the yellow metal. Several events over the next week may offer swings in price action including speeches from Fed Chair Jerome Powell and other Fed members, including Williams, Barr and Waller. The U.S. December trade balance and consumer confidence numbers for February are also on tap.

Several gold miners are also slated to release quarterly earnings results, which provide inflated implied volatility metrics across various stocks. Barrick Gold Corporation (GOLD) will announce results on February 15, Agnico Eagle Mines (AEM) on February 15, and Newmont Corporation (NEM) on February 23, among others.

Implied volatility may increase as we approach those dates, especially if gold prices continue to fade lower. Strategies such as a long straddle or strangle would take advantage of increased volatility even if prices rise. That could be the case if rate markets become more confused about what the Fed intends to do. The implied volatility rank (IVR) rose for Barrick Gold on the move lower in /GC after weeks of trending lower. A further unraveling of that prior trend would bode well for bullish volatility bets.

Gold in trading platform

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

Related Posts

tastylive content is created, produced, and provided solely by tastylive, Inc. (“tastylive”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. tastylive is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. Supporting documentation for any claims (including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer.  Options, futures, and futures options are not suitable for all investors.  Prior to trading securities, options, futures, or futures options, please read the applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange-Traded Options Risk Disclosure found on

tastytrade, Inc. ("tastytrade”) is a registered broker-dealer and member of FINRA, NFA, and SIPC. tastytrade was previously known as tastyworks, Inc. (“tastyworks”). tastytrade offers self-directed brokerage accounts to its customers. tastytrade does not give financial or trading advice, nor does it make investment recommendations. You alone are responsible for making your investment and trading decisions and for evaluating the merits and risks associated with the use of tastytrade’s systems, services or products. tastytrade is a wholly-owned subsidiary of tastylive, Inc.

tastytrade has entered into a Marketing Agreement with tastylive (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade. tastytrade and Marketing Agent are separate entities with their own products and services. tastylive is the parent company of tastytrade.

tastycrypto is provided solely by tasty Software Solutions, LLC. tasty Software Solutions, LLC is a separate but affiliate company of tastylive, Inc. Neither tastylive nor any of its affiliates are responsible for the products or services provided by tasty Software Solutions, LLC. Cryptocurrency trading is not suitable for all investors due to the number of risks involved. The value of any cryptocurrency, including digital assets pegged to fiat currency, commodities, or any other asset, may go to zero.

© copyright 2013 - 2024 tastylive, Inc. All Rights Reserved.  Applicable portions of the Terms of Use on apply.  Reproduction, adaptation, distribution, public display, exhibition for profit, or storage in any electronic storage media in whole or in part is prohibited under penalty of law, provided that you may download tastylive’s podcasts as necessary to view for personal use. tastylive was previously known as tastytrade, Inc. tastylive is a trademark/servicemark owned by tastylive, Inc.