Gold prices are steady on Tuesday, as the metal is trading at a spot price of $1282.55. On the release front, today’s highlight is Factory Orders. The markets are bracing for a sharp decline of 1.8%.
With the new Greek government looking to renegotiate its debt, Greece and its international creditors will have to reach some accommodation over Greece’s EUR 320 billion bailout program. European Commission President Jean-Claude Juncker has offered an olive branch to Athens, saying he is willing to scrap the troika mission, which represents the European Commission, ECB and the IMF and governs the bailout. However, he ruled out writing off any part of Greece’s debt. The new Greek government has stated it wishes to remain in the Eurozone but does not want to accept more bailout funds under the present agreement. Germany, which essentially calls the shots with regard to the bailout, has taken a hard line as it doesn’t want the Greek situation to set a precedent for other Eurozone members who have received bailouts. It is early going in this newest Greek saga, and the plot is sure to thicken.
US Advance GDP for Q4 disappointed, posting a gain of 2.6%. The markets had anticipated a gain of 3.0%. Still, market sentiment towards the US economy remains positive, underscored by the Federal Reserve statement last week, where the Fed noted solid growth in the economy. The Fed remains on track to raise rates later in 2015, and the dollar will likely benefit as speculation continues over the timing of a rate hike.
The Federal Reserve reiterated in its policy statement on Wednesday that it would be “patient” regarding the timeline for a raise in interest rates, which have been close to zero since 2008. However, the Fed also noted that the US economy was expanding at a “solid pace” thanks to the robust labor market. This vote of confidence pushed gold prices to lower levels. The Fed is widely expected to raise rates sometime during the year, so the Fed rate watch is sure to continue as the markets look for clues as to when the Fed will make a move.
XAU/USD for Tuesday, February 3, 2015
XAU/USD February 3 at 10:10 GMT
XAU/USD 1282.55 H: 1285.61 L: 1272.78
- XAU/USD broke above resistance at 1275 in the Asian session. The pair has edged higher in European trade.
- 1275 has reverted to a support role and remains a weak line. 1255 is stronger.
- The round number of 1300 is an immediate resistance line.
- Current range: 1275 to 1300
Further levels in both directions:
- Below: 1275, 1255, 1240, 1215 and 1200
- Above: 1300, 1322, 1345 and 1375
OANDA’s Open Positions Ratio
XAU/USD ratio is pointing to gains in long positions on Tuesday. This is consistent with the pair’s movement, as gold has posted slight gains. The ratio has a majority of long positions, indicating trader bias towards gold moving to higher ground.
- 15:00 US Factory Orders. Estimate -1.8%.
- All Day – US Total Vehicle Sales. Estimate 17.0M.
*Key releases are highlighted in bold
*All release times are GMT
OANDA MarketPulse Nominated for FXstreet’s 2015 Forex Best Awards
We are pleased to share the news that FXstreet – Europe’s oldest forex trading portal, published online in more than 50 countries – has nominated your MarketPulse team for the “Best Sell-Side Analysis Team” award again this year (the winners in 2014!), as well as in the category of “Best Analysis”.
The annual Forex Best Awards highlight the best analysis, educational content, and contributors on its website from the preceding year. It is a tremendous honour to be considered for this industry accolade out of the thousands of top tier banks and financial blogs online.
However, in order to win these important awards, we need your help – we need you to vote for us.
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.