Gold is showing little movement on Wednesday, with the spot price at $1318.38 per ounce late in the European session. The metal remains static as investors wait for the Final US GDP release later in the day. The markets are expecting a decline in the reading, so we could see some movement from XAU/USD. Today’s other key release is Consumer Durable Goods Orders.
The fighting in Iraq continues, as militants linked to al-Qaeda have overrun the north of the country. The insurgents are threatening the capital of Baghdad, and the situation has become a major crisis for both the Iraqi and US governments. Over the weekend, US President Barack Obama said the crisis could spread to other countries in the region. Meanwhile, the situation is tense in Ukraine, as the government has vowed to press ahead and sign an economic association agreement with the EU on Friday. The crises in Iraq and Ukraine have pushed the price of gold above the $1300 level, as the metal is considered a hedge during periods of geopolitical instability.
US data looked sharp on Tuesday, with strong gains in consumer confidence and housing numbers. CB Consumer Confidence improved to 85.2 points, beating the estimate of 83.6 points. It was the strongest level since December 2007. New Home Sales had a superb reading, jumping to 504 thousand, crushing the estimate of 442 thousand. It was the key indicator’s best showing since August 2008. If upcoming indicators continue to point upwards, we could see the US dollar gain strength.
XAU/USD for Wednesday, June 25, 2014
XAU/USD June 25 at 11:50 GMT
XAU/USD 1318.38 H: 1319.60 L: 1313.51
- Gold edged lower in the Asian session and is almost unchanged in European trading.
- 1315 is an immediate support role. This is followed by the round number of 1300.
- 1331 is providing resistance. This is followed by resistance at 1354, which has held firm since March.
- Current range: 1315 to 1331.
Further levels in both directions:
- Below: 1315, 1300, 1275 and 1260
- Above: 1331, 1354, 1375 and 1389
OANDA’s Open Positions Ratio
XAU/USD ratio is almost unchanged in Wednesday trade. This is reflected in the pair’s movement, as XAU/USD is showing little movement. The ratio is made up of a majority of long positions, reflecting trader bias towards gold prices breaking out and gaining ground against the dollar.
- 12:30 US Core Durable Goods Orders. Estimate 0.3%.
- 12:30 US Final GDP. Estimate -1.8%.
- 12:30 US Durable Goods Orders. Estimate -0.1%.
- 12:30 US Final GDP Price Index. Estimate 1.3%.
- 13:45 US Flash Services PMI. Estimate 58.6 points.
- 14:30 US Crude Oil Inventories. Estimate -1.2M.
*Key releases are highlighted in bold
*All release times are GMT