Gold Unchanged Ahead of Nonfarm Payrolls

Gold continues to show little movement, as the spot price stands at $1201.10 in Friday’s European session. On the release front, the markets are expecting a strong reading from Nonfarm Employment Change, with the estimate standing at 231 thousand. As well, the US will release the Unemployment Rate and Trade Balance.

On Thursday, ECB head Mario Draghi said that that he had no plans to implement quantitative easing for the time being and that the ECB would review its stimulus program in early 2015. The euro shot up about 130 points following the news, although it later gave back some of these gains. The ECB also downgraded its forecasts for growth and inflation, and if the Eurozone economy fails to improve, there is a reasonable likelihood that the ECB will embark on the QE route. Meanwhile, there was some unexpected good news from Germany on Friday, as Factory Orders climbed 2.5% in October, marking a three-month high. This is easily beat the forecast of a 0.6% gain.

There was good news on the US employment front on Thursday, as jobless claims improved to 297 thousand, practically matching the forecast. We’ll get a look at the official Nonfarm Employment Change report on Friday, with the markets expecting a strong reading of 231 thousand. If the indicator meets expectations, the US dollar could take advantage and post gains.

 

XAU/USD for Friday, December 5, 2014

XAU/USD December 5 at 10:30 GMT

XAU/USD 1204.31 H: 1206.66 L: 1201.78

 

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1156 1175 1200 1215 1240 1255

 

  • XAU/USD has shown almost no movement in the Asian and European sessions. The pair continues to trade close to the key 1200 line.
  • 1200 remains fluid and could see action during the day. It is currently a weak support level. 1175 is stronger.
  • 1215 is an immediate resistance line. 1240 is next.
  • Current range: 1200 to 1215.

Further levels in both directions:

  • Below: 1200, 1175, 1156, 1130 and 1111
  • Above: 1215, 1240, 1255 and 1275

 

OANDA’s Open Positions Ratio

XAU/USD ratio is pointing to gains in long positions on Friday, reversing the direction seen a day earlier. This is not consistent with the pair’s movement, as gold is unchanged. The ratio is made up of a majority of long positions, indicative of trader bias towards gold moving higher.

XAU/USD Fundamentals

  • 13:30 US Nonfarm Employment Change. Estimate 231K.
  • 13:30 US Trade Balance. Estimate -41.3B.
  • 13:30 US Unemployment Rate. Estimate 5.8%.
  • 13:30 US Average Hourly Earnings. Estimate 0.2%.
  • 13:45 US FOMC Member Loretta Mester Speaks.
  • 15:00 US Factory Orders. Estimate 0.0%.
  • 19:45 US FOMC Member Stanley Fischer Speaks.
  • 20:00 US Consumer Credit. Estimate 16.5B.

*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

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.