Gold remains under pressure on Tuesday, as the metal continues to lose ground to the strong US dollar. In the European session, the spot price stands at $1207.40 per ounce just above the 2014 low of $1201.97. On the release front, today’s key event is CB Consumer Confidence, with the markets expecting another strong reading above the 90-point level.
Recent sharp gains by the US dollar are weighing on gold prices, as a stronger dollar diminishes the metal’s appeal as an alternative asset to the dollar. The dollar has enjoyed a spectacular September, and gold prices have tumbled over 6% during this period. We could see gold dip below $1200, which last occurred in December 2013.
Over in the US, Pending Home Sales posted a decline of 1.0%, compared to last month’s gain of 3.3%. The important housing indicator has shown strong movement, resulting in readings that have been well off market estimates. US housing indicators continue to paint a mixed picture, as New Home Sales jumped last month, while Existing Home Sales softened and was well short of expectations.
XAU/USD for Tuesday, September 30, 2014
XAU/USD September 30 at 12:30 GMT
XAU/USD 1207.40 H: 1218.90 L: 1204.45
- XAU/USD was flat in the Asian session. The pair has posted losses in European trade, breaking below support at 1210.
- 11186 is an immediate support level. 1156 is next.
- 1210 has reverted to a resistance role as gold trades at lower levels. This line is fluid and could see further action during the day. There is stronger resistance at 1240.
- Current range: 1186 to 1210.
Further levels in both directions:
- Below: 1186, 1156, 1136 and 1101
- Above: 1210, 1240, 1252, 1275 and 1300
OANDA’s Open Positions Ratio
XAU/USD ratio is pointing to gains in short positions in Tuesday trade. This is consistent with the pair’s movement, as gold has sustained losses. The ratio has a substantial majority of long positions, indicative of trader bias towards gold reversing directions and moving to higher ground.
- 13:00 US S&P Composite-20 HPI. Estimate 7.5%.
- 13:45 US Chicago PMI. Estimate 61.6 points.
- 14:00 US CB Consumer Confidence. Estimate 92.2 points.
*Key releases are highlighted in bold
*All release times are GMT