Gold has posted strong gains in the Wednesday session, erasing the losses from Tuesday. In North American trade, the spot price for an ounce of gold is $1285.57, up 0.83% on the day. On the release front, there are no key events on the schedule. On Thursday, the US releases unemployment claims.
After failing to pass a new healthcare act, President Trump has his sights set on tax reform, a key item in his domestic platform. Trump wants Congress to pass legislation overhauling the tax code before the end of the year, but that could prove to be too tight of a deadline. Most Democrats have come out against the proposal, and not all Republicans are on board. The bill would cut corporate taxes from 35% to 20%, but predictably, Democrat and Republican lawmakers are at odds as to whether the bill will lower taxes for the middle class. The bill is presently being debated in a congressional committee and is expected to move to the House floor next week. The Senate will present its version of the bill on Thursday, so we can expect plenty of activity in Congress in the next few weeks. Tax reform faces an uphill battle, which has weighed on investor risk appetite and pushed gold prices higher.
The labor market remains very strong, and this was reflected in another sharp employment report on Tuesday. JOLT Jobs Openings was almost unchanged at 6.09 million, easily beating the forecast of 5.98 million. Unemployment claims are also expected to show little movement on Thursday, with a forecast of 232 thousand. The unemployment rate is at a sizzling 4.1%, but wage growth remains a concern, reflective of weak inflation. In October, Average Hourly Earnings posted a flat 0.0.%, the first time wages have not increased since November 2016.
Wednesday (November 8)
- 10:30 US Crude Oil Inventories. Estimate -2.5M. Actual +2.2M
- 13:01 US 10-year Bond Auction
Thursday (November 9)
- 8:30 US Unemployment Claims. Estimate 232K
*All release times are GMT
*Key events are in bold
XAU/USD for Wednesday, November 8, 2017
XAU/USD November 8 at 12:35 EST
Open: 1275.20 High: 1287.26 Low: 1275.20 Close: 1285.57
- 1260 is providing support
- 1285 is under pressure in resistance
- Current range: 1260 to 1285
Further levels in both directions:
- Below: 1260, 1240 and 1213
- Above: 1285, 1307, 1337 and 1367
OANDA’s Open Positions Ratio
XAU/USD ratio is showing little movement in the Wednesday session. Currently, long positions have a majority (72%), indicative of trader bias towards XAU/USD reversing directions and moving towards higher ground.
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.