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Gold Trading At $1300 As Unemployment Claims Shine

Gold prices are steady on Thursday, as the spot price is just above the key $1300 level late in the European session. In economic news, US Unemployment Claims was steady and beat the estimate. Later in the day, we’ll get a look at another key event, with the release of the Philly Fed Manufacturing Index.

In the US, Unemployment Claims had another strong release, coming in at 304 thousand. This was well below the estimate of 316 thousand, and marked the second straight week that the key indicator beat the estimate. With the Federal Reserve saying that further trims to QE will depend on the health of the employment market, employment numbers have taken on added significance.

The US dollar is broadly lower following dovish comments by Federal Reserve chair Janet Yellen on Wednesday. Yellen said there is little inflationary pressure on the economy, and it was unlikely that the Fed’s inflation target of 2% would be met. She added that although the economy has showed signs of recovery, unemployment remains a sore spot. The Fed has abandoned its promise to maintain interest rates at least as long as the unemployment rate is above 6.5%, but the dovish stance we are seeing from Yellen means that a rate hike is unlikely in the near future.

Tensions between East and West continue over the volatile situation in Ukraine. There have been several skirmishes between pro-Russian militiamen and Ukrainian forces, and casualties have been reported on both sides. Secretary of State John Kerry and his Russian counterpart are meeting on Thursday, but a quick resolution is unlikely. Western Europe is dependent on Russian oil and gas, so we could see some market movement as the crisis continues.

 

XAU/USD for Thursday, April 17, 2014

Forex Rate Graph 21/1/13

XAU/USD April 17 at 12:50 GMT

XAU/USD 1300 H: 1304 L: 1296

 

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1241 1260 1273 1315 1330 1355

 

Further levels in both directions:

 

OANDA’s Open Positions Ratio

XAU/USD ratio has a substantial majority of long positions, reflecting a strong trader bias towards gold moving higher against the dollar.

Gold is steady in Thursday trading, as the pair hovers close to the $1300 line.

 

XAU/USD Fundamentals

*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 [4]

Market Analyst at OANDA [5]
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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