Today's video recorded by: Konrad Urbanowicz

A hotter-than-expected August inflation report all but locked in a rate hike at next week's FOMC meeting, yet gold rallied anyway on Friday — a sign, technicians say, that the metal has already priced in higher rates and turned its attention to other drivers.

Gold futures for December delivery (GCZ2026) fell by $88.70 or 2% closing out the session at the lowest level since August 6th at $4,358.50 and firmly breaking beneath the 50% retracement which had been acting as support. The decline today was based out off two different inflationary drivers.

Precious metals delivered a strong session on Wednesday, with gold and silver futures both posting solid gains even as their underlying technical pictures continued to diverge. Gold futures gained a respectable $47, or 1.07%, on the day, closing at $4,447.

Bullion falls 1.72% as traders price in a 60% chance of a quarter-point hike, while Middle East-driven oil gains add to the inflation case. 

Gold and silver both traded lower on the day on the increased odds for a rate hike later this month. Gold futures fell by $43 or 0.95% and silver futures declined by $0.74 or 1.11% on the day. The catalyst for today’s decline was the US Labor Department’s non-farm payroll report for August showing 162,000 jobs were created in August, massively beating consensus forecasts of just 55,000.

Gold’s 3rd Wave; Projected Triple Top in Gold by Year’s End

Gold had its first sizable gain since hitting a peak of $4,755 on August 25th. In those brief 6 trading days, gold futures experienced 3 days of extreme selling pressure separated by a doji candle between each decline; together, those 8 trading days add up to a $425, or 8.95%, loss in value (from the Aug. 25th high to today’s low), forming our wave 2.

Gold futures suffered their second $120+ single-session decline in just the last 6 days on Tuesday, with COMEX December contracts (GCZ2026) falling $126, or 2.9%, to settle near $4,252 an ounce. The drop pushed the metal decisively below a cluster of technical support levels that had been taken out just recently.

Gold futures managed to hold steady on Monday, even as they gapped lower from Friday's close in reaction to a perceived hawkish speech from Fed Chairman Kevin Warsh at Jackson Hole.