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Gold Stable As Markets Eye US Job Numbers

Gold continues to show little movement on Friday. In the European session, the spot price stands at $1145.55. Gold prices have tumbled almost 7% in little over a week, as XAU/USD trades at 4.5-year lows. Employment events are in the spotlight, with the release of Nonfarm Employment Change and the Unemployment Rate. The markets are expecting solid figures from both key releases. Later in the day, Fed Chair Janet Yellen will speak at an event in Paris, France.

Mario Draghi and his ECB colleagues haven’t had much to cheer about lately, with the Eurozone mired in low growth, weak inflation and high unemployment. Draghi has lowered interest rates to the bone, but the cuts have not improved the economic situation. The ECB has decided to focus on its balance sheet and has issued long-term loans to banks and purchased covered bonds. The ECB will begin buying asset-backed purchases later this month, so we could see the wobbly euro lose more ground. However, these moves may not be enough and Draghi may be forced to borrow a page from the book of other central banks and commence QE, which is the purchase of government securities.

With the US recovery continuing to deepen, employment numbers continue to improve. This trend was underscored on Thursday, as Unemployment Claims fell to 278 thousand. This was better than the estimate of 285 thousand and marked a three-week low. This strong figure comes on the heels of the ADP Nonfarm Payrolls report, which climbed to 230 thousand, its strongest showing in 2014. The week wraps up with the official Nonfarm Payrolls release on Friday. The markets are expecting a downturn, with the estimate standing at 229 thousand. Will the key indicator surprise the markets and beat the forecast? If so, gold prices could soften.


XAU/USD for Friday, November 7, 2014

XAU/USD November 7 at 9:55 GMT

XAU/USD 1145.55 H: 1146.66 L: 1130.02


XAU/USD Technical

S3 S2 S1 R1 R2 R3
1073 1111 1130 1156 1175 1200


Further levels in both directions:


OANDA’s Open Positions Ratio

XAU/USD ratio is pointing to gains in short positions on Friday. This is not consistent with the pair’s movement, as gold has posted small gains. The ratio has a majority of long positions, indicative of trader bias in favor of gold moving higher.


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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