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Gold has traded between $1,241 and $1,266 so far today on this “Jobs Friday”…as of 10:00 am Pacific, bullion is down just $2 an ounce at $1,253 as it fights to avoid a 9th straight losing session…Silver has added 10 cents to $17.38…Copper is up a penny at $2.16…Crude Oil has fallen 67 cents to $49.77 while the U.S. Dollar Index has eased off one-quarter of a point to 96.67 after pushing above 97.20 in early trading (strong resistance between 97 and 98)…

Even as Gold has fallen over the last week, holdings by exchange-traded funds have actually risen…this underscores how entrenched the ETF buying is – physical buyers aren’t about to be spooked – and how it will likely continue to help underpin the yellow metal…

There was a modest miss in today’s jobs report as the Labor Department announced that non-farm payrolls for last month came in at 156,000, almost 20,000 less than the consensus estimate, while the unemployment rate unexpectedly edged up one-tenth of a point to 5.0%…average hourly earnings matched expectations with an increase of 0.2% and an annualized rate of 2.6%…

Cleveland Fed President Loretta Mester, an FOMC voting member who has been arguing recently for a rate hike, told CNBC this morning that the government’s weaker-than-expected report for September was still strong enough to keep her thinking central bankers should increase rates.  “It’s a solid labor market report,” Mester said on ‘Squawk Box’.   “This is very consistent with what we expected to see.”

Meanwhile, Fed Vice President Stanley Fischer, who was musing over the summer about the possibility of two rate hikes before year-end, called this morning’s report close to a “Goldilocks” number…

Expect Fed hawks to push their case hard for a rate hike before year-end…whether the Fed ultimately pulls the trigger, however, is the big question, as their rhetoric has proven to mean little, and there are still multiple economic uncertainties at play plus an election to go through (in case didn’t see this reported by the liberal mainstream media, Bank of America Merrill Lynch warned clients this week of a potential recession as early as next year, should some of the firms’ economic indicators continue to decline)…

September’s jobs report may have modestly “missed the mark” but the CME’s Fed Funds futures tracker reflects a growing expectation among traders this morning for a December interest rate hike…again, we’ve seen that movie many times before…

Signs Of A Pick-Up In Asian Gold Buying

Demand for Gold in Asia edged up this week as prices hovered near their lowest since early June, while discounts in India narrowed the most in 8-and-a-half months as a fall in prices prompted buying during the festive season…the appetite for Gold in India typically strengthens in the last quarter as the world’s second-biggest consumer gears up for the wedding season as well as festivals such as Diwali and Dussehra…

Goldman Sachs today on what may spur buying in China during Q4:  “The potential drivers of increased Chinese physical buying include purchasing Gold as a way to hedge for potential currency depreciation in the face of capital controls, and purchasing Gold as a way of diversifying away from the property market, which has this year to date had a remarkable rally (with the government moving to rein in speculation and price growth).”

This week’s drop in Gold came, perhaps not coincidentally, as Chinese buyers were on the sidelines due to a week-long national holiday in that country…Chinese traders are back at their desks on Monday…

“Flash Crash” In British Pound

If you think the trading in Gold has been crazy this week, how about the action in the British pound overnight?…the currency suffered a jarring flash crash, nose-diving more than 6% against the dollar in a matter of minutes before recouping some of those losses…the shock came in early trading in Asia (interesting timing, manipulation?) and left investors and analysts blaming computerized programs for intensifying the dizzying drop…

The pound had already sunk to a fresh 31-year low of around $1.26 yesterday over deepening concerns that the U.K.’s split from the EU will hurt the country’s economy…strategists had widely forecast it would go lower, but not as rapidly as it did overnight…was a big market player making a very large move?…

“It was just another quiet day in Asia, and then, Bang! All the lights went red,” said Matt Simpson, senior market analyst at ThinkMarkets in Singapore…

Gold Secular Chart

This long-term chart for Gold, going back 3 decades, shows how bullion remains locked in “Wave 5” of a bull market that ultimately should produce similar gains to “Wave 1” and “Wave 3“…that means Gold during this cycle could push well past its 2011 peak of $1,924…

The pullback from the 2016 high of nearly $1,380 has brought RSI(14) back to the 50% level which may become new support, similar to what occurred in late 2001 after an initial spike…

Significantly, 2016 has witnessed the first bullish +DI/-DI cross in 15 years, marking a clear change in direction after a down wave intensified in 2013…sell pressure (CMF) has eased considerably this year but has yet to transition into buy pressure on this long-term monthly chart, meaning we’re still in the early stages of a prolonged move with $1,200 acting as the new floor…

In Today’s Morning Musings…

1. Crude Oil and Africa Oil (AOI, TSX) updates…

2. Opportunity in a Venture “shell”…

3. Aerospace stock could be ready to “fly” in Q4…

4. Daniel’s Den – exploring the mentality of great traders and investors…

Plus more…click here to read the rest of today’s Morning Musings and all BMR exclusive content, through a risk-free Pro, Gold or Basic package, or login with your username and password…