(eToro Blog) With spot gold currently trading at the 1539.73 level, near term sentiment remains cautiously bullish going into Friday's closely watched U.S. Employment Report. Nevertheless, the bullion market seems too shy after early May's sharp selloff from 1575.45 down to 1462.24 to take gold much higher ahead of the key Non Farm Payrolls release.

Silver sentiment seems more mixed, with formerly bullish traders still licking their wounds after the dramatic 35% crash seen in late April to early May. Silver also sustained a considerable intraday drop yesterday from 38.42 down to a low of 36.36, although it subsequently recovered somewhat and is currently trading at the 37.08 level.

With respect to the upcoming U.S. employment data, the U.S. Bureau of Labor Statistics is scheduled to release its latest Employment Report this coming Friday, June 3rd at 1:30pm GMT or 8:30am EST. This key report includes the headline Unemployment Rate that is forecast to remain steady at 9.0% for May, as well as the closely watched Non Farm Payrolls or NFP number that measures the previous month's change in the number of people employed in the United States.

NFP for May is currently expected to rise by 194K versus April's 244K rise that exceeded the 185K consensus of market analysts' expectations for April. Nevertheless, the ADP Non Farm Employment Change out today at 38K was considerably below the consensus of 177K and so may portend a significant disappointment for the NFP on Friday.

A substantially lower result for the Non Farm Payrolls number than expected - perhaps accompanied by a corresponding rise in the Unemployment Rate - could send the U.S. Dollar sharply lower and would also likely boost the price of gold and silver. Alternatively, an unexpectedly positive Employment Report could well see the Greenback rise, and that in turn would tend to put a damper on the recent recovery in gold and silver.

Overall, sentiment among bullion traders currently does not support new long term highs in either the price of gold or silver, at least until after this Friday's NFP release has been digested by the markets.

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