Since this week, the conflict between the two has been public and escalating. After the passionate exchange of insults on social media, the close allies of the past few months finally broke up. This not only caused Tesla’s stock price to plummet 14% on Thursday, but what is more worrying is that the two “strong men” will not back down easily and have enough ability to “fight back”, so the slightly improved market atmosphere and confidence may fall to the freezing point again.
Tesla’s stock price wiped out most of the gains since the low in April, dragging down the three major US indexes on Thursday, and the process of US stocks hitting historical highs may be forced to slow down.
Earlier, the leaders of China and the United States decided to continue bilateral trade negotiations on a call, but this did not inject much vitality into the market, because this is destined to be a long and complicated negotiation, and it is difficult to see major positive news in the short term. The influence of the trade war on the market is weakening.
In addition to the news, the most surprising thing on Thursday was the re-emergence of silver. The price of silver rose 3.3% and broke through the key $35 mark in one fell swoop, opening up new room for growth. Will silver start to make up for the rise?
Comparison of historical trends of gold and silver Source: Tradingview
Looking back at history, silver and gold tend to move in sync, and silver’s volatility is greater than gold’s. However, in the past two years, the increase in silver prices has been far less than that of gold, and the current gold-silver ratio of 93 is also at a historical high. Although silver prices are expected to continue to rise in the short term, it is difficult to catch up with gold’s increase because it does not have the same risk-averse and investment attributes, scarcity, and physical properties as gold (gold is easier to store and transport), and its industrial attributes are difficult to fully reflect in the current economic environment.
Back to the non-farm payrolls at 20:30 tonight, from the employment data released this week:
The number of vacancies in the United States rose to 7.391 million in April, exceeding expectations and previous values
ADP data showed that the number of new jobs in the private sector unexpectedly fell to 37,000 in May, the lowest level since March 2023, and the previous value was revised down from 115,000 to 60,000. However, the correlation between ADP and non-farm payrolls is not high, so it is not very useful for reference
The number of initial jobless claims rose to 247,000 last week, the highest level since October
For tonight’s non-farm payrolls report, the market expects 130,000 new jobs, with a previous value of 170,000; the unemployment rate is expected to remain at 4.2%, and the hourly wage growth rate may drop slightly to 3.7%.
The weaker-than-expected employment report, coupled with the current market atmosphere, may put pressure on the high level of US stocks, and at the same time stimulate expectations of interest rate cuts, which will be bearish on the US dollar. On the contrary, data higher than expected can at least partially offset or divert the negative impact of the tension between Trump and Musk and stabilize market sentiment. If the employment report is mixed, the unemployment rate may have a higher impact weight, after all, it is the economic indicator that the Federal Reserve values more.
Figure: The past 12 non-agricultural data and the market performance on the day
Source: Investing.com, Tradingview, Forex.com
XAUUSD 4 hours
Source: TradingView, Forex.com
Gold has been in a high-level oscillation since May, and the fluctuation range of gold prices has narrowed significantly since the beginning of June.
This week, the 3340/50 area has formed support many times, and it is expected to continue to form a buffer for gold prices together with the rising trend line since May. Judging from the trend of each cycle, the bulls still have the initiative, and the callback is the main consideration at present. 3390-4000 is the high point of this week and an important goal for the bulls. In the downward direction, if it falls below the trend line, it may fall to 3300.
The overnight implied volatility of gold is 16.8%. This low value means that the price of gold is likely to fluctuate between 3317.20-3388.45 on the night of non-agricultural, that is, the range of 36 US dollars above and below the closing price on Thursday. The market does not seem to think that the price of gold will have abnormal and violent fluctuations tonight.
Non-agricultural Tesla plummets and silver rebounds
Since this week, the conflict between the two has been public and escalating. After the passionate exchange of insults on social media, the close allies of the past few months finally broke up. This not only caused Tesla’s stock price to plummet 14% on Thursday, but what is more worrying is that the two “strong men” will not back down easily and have enough ability to “fight back”, so the slightly improved market atmosphere and confidence may fall to the freezing point again.
Tesla’s stock price wiped out most of the gains since the low in April, dragging down the three major US indexes on Thursday, and the process of US stocks hitting historical highs may be forced to slow down.
Earlier, the leaders of China and the United States decided to continue bilateral trade negotiations on a call, but this did not inject much vitality into the market, because this is destined to be a long and complicated negotiation, and it is difficult to see major positive news in the short term. The influence of the trade war on the market is weakening.
In addition to the news, the most surprising thing on Thursday was the re-emergence of silver. The price of silver rose 3.3% and broke through the key $35 mark in one fell swoop, opening up new room for growth. Will silver start to make up for the rise?
Comparison of historical trends of gold and silver Source: Tradingview
Looking back at history, silver and gold tend to move in sync, and silver’s volatility is greater than gold’s. However, in the past two years, the increase in silver prices has been far less than that of gold, and the current gold-silver ratio of 93 is also at a historical high. Although silver prices are expected to continue to rise in the short term, it is difficult to catch up with gold’s increase because it does not have the same risk-averse and investment attributes, scarcity, and physical properties as gold (gold is easier to store and transport), and its industrial attributes are difficult to fully reflect in the current economic environment.
Back to the non-farm payrolls at 20:30 tonight, from the employment data released this week:
The number of vacancies in the United States rose to 7.391 million in April, exceeding expectations and previous values
ADP data showed that the number of new jobs in the private sector unexpectedly fell to 37,000 in May, the lowest level since March 2023, and the previous value was revised down from 115,000 to 60,000. However, the correlation between ADP and non-farm payrolls is not high, so it is not very useful for reference
The number of initial jobless claims rose to 247,000 last week, the highest level since October
For tonight’s non-farm payrolls report, the market expects 130,000 new jobs, with a previous value of 170,000; the unemployment rate is expected to remain at 4.2%, and the hourly wage growth rate may drop slightly to 3.7%.
The weaker-than-expected employment report, coupled with the current market atmosphere, may put pressure on the high level of US stocks, and at the same time stimulate expectations of interest rate cuts, which will be bearish on the US dollar. On the contrary, data higher than expected can at least partially offset or divert the negative impact of the tension between Trump and Musk and stabilize market sentiment. If the employment report is mixed, the unemployment rate may have a higher impact weight, after all, it is the economic indicator that the Federal Reserve values more.
Figure: The past 12 non-agricultural data and the market performance on the day
Source: Investing.com, Tradingview, Forex.com
XAUUSD 4 hours
Source: TradingView, Forex.com
Gold has been in a high-level oscillation since May, and the fluctuation range of gold prices has narrowed significantly since the beginning of June.
This week, the 3340/50 area has formed support many times, and it is expected to continue to form a buffer for gold prices together with the rising trend line since May. Judging from the trend of each cycle, the bulls still have the initiative, and the callback is the main consideration at present. 3390-4000 is the high point of this week and an important goal for the bulls. In the downward direction, if it falls below the trend line, it may fall to 3300.
The overnight implied volatility of gold is 16.8%. This low value means that the price of gold is likely to fluctuate between 3317.20-3388.45 on the night of non-agricultural, that is, the range of 36 US dollars above and below the closing price on Thursday. The market does not seem to think that the price of gold will have abnormal and violent fluctuations tonight.
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Non-agricultural Tesla plummets and silver rebounds
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