During the Asian session on August 7 Beijing time, international precious metals markets entered a cautious 'pre-NFP' mode. Spot gold, after four straight sessions of rebound, held above $4,240/oz, pulling back modestly from the $4,300 level touched overnight. Spot silver retreated to consolidate near $61 after surging above $62. Attention is firmly on the US July nonfarm payrolls report due at 20:30 tonight—the data will determine whether gold breaks above $4,300 or retests the $4,200 area, making it the most important 'watershed' for precious metals this month.
Market Snapshot: Gold Consolidates at Highs; Silver Diverges in Short Term
At press time, London spot gold traded around $4,246/oz, up about 0.2% on the day, after reaching the upper end of the $4,232–$4,248 range. COMEX gold futures for the front-month contract were near $4,248, also consolidating at highs. In China, SGE AU9999 was around RMB 920/g, while the main Shanghai gold futures contract slipped 0.01% overnight to RMB 925/g.
Silver showed short-term divergence: spot silver had rallied about 5% above $62/oz to a stage high, then pared gains to last around $61.3–$61.5/oz, slightly weaker on the day. Shanghai silver futures main contract closed down 0.93% overnight at RMB 15,076/kg. The gold/silver ratio held at 69–70, historically elevated, with silver's industrial and gold's safe-haven attributes rotating in this move.
Review: Weak ADP and Geopolitical Easing Send Gold Back toward $4,300
The trigger for this rebound came on August 5–6. First, US July ADP private-sector payrolls rose by only 44,000, far below the 70,000 expected and down from 95,000 previously, a clear sign of labor-market cooling. The employment subindex of the ISM non-manufacturing PMI then fell into contraction, reinforcing easing expectations.
Meanwhile, US Treasury Secretary Bessent signaled that a Strait of Hormuz agreement could be reached on the 4th–5th; oil prices fell, with Brent near $78/barrel. Lower oil dampened inflation expectations, dragging the 10-year Treasury yield to the 4.6% area while the dollar index fell below 100—the opportunity cost of holding gold dropped sharply. Bulls pushed aggressively and short covering amplified gains. London spot gold surged more than $180 in a single day, up over 4%, its biggest daily gain since February 2026, and briefly broke above $4,300 for the first time since June 18.
Tonight's NFP: Three Scenarios for Gold and Silver
Markets broadly expect July nonfarm payrolls of about 91,000, up from 57,000 in June, with unemployment edging up from 4.2% to 4.3%. After the ADP miss and JOLTS job openings falling to 7.35 million, this official report carries more weight. Aggregating several institutional views, three scenarios emerge:
- Scenario 1 (NFP below 70,000): Rate-hike expectations would plummet; gold could target $4,360 after breaking $4,300, or $4,418 on strong volume; silver may attack the $64 level.
- Scenario 2 (NFP 70,000–100,000): This matches the baseline; gold will likely oscillate in the upper $4,200–$4,300 box, using time to digest overbought signals before picking a direction.
- Scenario 3 (NFP above 100,000): Sticky inflation and strong employment would reignite September rate-hike expectations; gold could give back gains and break below $4,200, with first support at $4,180–$4,170, and a deeper drop toward $4,053 if that fails.
It should be noted that the Fed's July meeting held rates at 3.50%–3.75% by 9 to 3, with three members favoring a 25bp hike, leaving hawkish divisions intact. Fed funds futures put September hike odds at about 53%, down from 80%, but inflation remains sticky—ISM services prices paid rose to 70.3—so the tug-of-war between 'cooling jobs' and 'sticky inflation' will persist and precious metals volatility may widen.
Technicals: $4,250 Is the Short-Term Line in the Sand
Structurally, spot gold's $4,250 area remains the key battleground. If gold holds it, weak labor momentum and lower real yields should support bulls, with the next target the $4,305–$4,330 resistance zone, then $4,500. If $4,237 is lost, near-term support shifts to $4,196 and $4,162. For silver, bulls need to reclaim $62.92 to open upside toward $64–$65; primary support is $61.42, then $60.49 and $59.75.
Central-Bank Buying Backstops: Structural Bull Case Unchanged
Importantly, this rebound has solid structural support. World Gold Council data show global central banks and other official institutions added a net 289 tonnes of gold reserves in Q2 2026, up 62% year-on-year; 45% of surveyed central banks expect further accumulation over the next year. China Gold Association data released August 6 show China added 40.12 tonnes in H1, with reserves at 2,346.45 tonnes by end-June, fifth globally, extending a 20-month buying streak since November 2024. The Bank of Korea also resumed purchases after 13 years. Persistent official-sector buying provides a thick safety cushion for gold.
CITIC Securities Research's macro-asset team believes gold remains in the bull market that began in 2015. The three long-term drivers—rising US fiscal deficits, persistent geopolitical conflicts, and sustained central-bank buying—are unchanged. The area near $4,000 is likely the bottom of this correction, and gold may return to an upward channel within the year. But many institutions also warn that short-term moves are unlikely to be one-way; the staggered release of NFP, CPI and PCE will bring repeated swings, so investors should not be overly optimistic about a straight rally.
Singapore Perspective: SGX Deliveries and Physical Demand Worth Watching
From Singapore's precious metals perspective, trading activity and physical-delivery premiums on SGX precious metals contracts deserve close attention during this rebound. Earlier, SGX silver inventories fell notably and physical delivery premiums climbed to historical highs, reflecting strong physical demand from Asian markets. If gold breaks upward after NFP, fund flows and inventory changes in the Singapore market could be key gauges of trend durability. Investors may also watch the People's Bank of China's July forex and gold reserve data due today to assess the continuity of official buying.
Overall, this August 7 'NFP night' is bound to be eventful. Gold is coiled at a seven-week high, silver is contesting the $62 level, and both sides are waiting for the key data to deliver the final answer. Whatever the outcome, managing positions and monitoring key levels remain the core principles for surviving high-volatility markets.
