Gold Prices Stable As Markets Eye Unemployment Claims and Retail Sales

Gold is showing little movement on Thursday, continuing the trend we saw a day earlier. In the European session, the spot price at $1263.81 per ounce. We could see some activity from the precious metal following today’s key US releases – Unemployment Claims, Retail Sales and Core Retail Sales.

There was more good news on the US employment front, as JOLTS Job Openings jumped to 4.46 million, up sharply from 4.01 million a month earlier. This easily beat the estimate of 4.04 million, and comes on the heels of a positive Nonfarm Payrolls last week. We’ll get a look at Unemployment Claims on Thursday, with the markets expecting a slight improvement compared to the previous release.

The ECB’s rate cuts are a belated response to weak growth and low inflation in the Eurozone, but the markets had expected more. The cut in the benchmark rate was not as deep as anticipated, and many market players were looking for the introduction of an asset purchase program, such as the schemes adopted by the Federal Reserve and Bank of England. It’s safe to say that the markets were underwhelmed by the ECB’s actions, with one analyst saying the ECB had fired a lot of small bullets rather than resorting to a bazooka. If growth and inflation numbers in the Eurozone continue to struggle, the ECB will be under pressure to take more action next month. After the ECB move, gold got a boost as investors dumped their euros and sought the safety of safe-haven gold.

 

XAU/USD for Thursday, June 12, 2014

XAU/USD June 12 at 12:25 GMT

XAU/USD 1263.81 H: 1266.75 L: 1259.92

 

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1230 1250 1260 1275 1300 1315

 

  • Gold is steady on Thursday.
  • 1260 continues to provide weak support. Next there is support at 1250.
  • The key level of 1275 is the next resistance line. This is followed by resistance at the round number of 1300.
  • Current range: 1260 to 1275.

Further levels in both directions:

  • Below: 1260, 1250, 1230, 1200 and 1182
  • Above: 1275, 1300, 1315 and 1331

 

OANDA’s Open Positions Ratio

XAU/USD ratio is almost unchanged on Thursday, continuing the trend seen for most of the week earlier. This is consistent with what we are seeing from the pair, which is showing little activity. The ratio is made up of a substantial majority of long positions, reflecting a strong trader bias towards gold breaking out and gaining ground against the US dollar.

Gold continues to show little movement. XAU/USD has edged higher in the European session.

 

XAU/USD Fundamentals

  • 12:30 US Core Retail Sales. Estimate 0.4%.
  • 12:30 US Retail Sales. Estimate 0.5%.
  • 12:30 US Unemployment Claims. Estimate 306K.
  • 12:30 US Import Prices. Estimate 0.2%.
  • 14:00 US Business Inventories. Estimate 0.4%.
  • 14:30 US Natural Gas Storage. Estimate 111B.
  • 17:01 US 30-year Bond Auction.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.