Gold Shows Slight Losses as Jobless Claims Beats Expectations

Gold prices are slightly lower on Thursday, as the metal is trading at a spot price of $1262.42. In the US, Unemployment Claims rose last week to 278 thousand but beat the estimate. Trade Balance missed expectations, coming in at $-46.6 billion.

Are Greece and its international creditors on a collision course? The new Greek government has declared that it will not honor the current bailout agreement and has put a halt to the sale of major public assets to help pay back debt. The ECB hit back late on Wednesday, saying that it would no longer accept Greek government bonds as collateral for ECB loans. This will put pressure on Greek banks and serves as a warning that the ECB will not stand idly by as Greece tries to avoid its bailout obligations. The drama will continue next week, as German Chancellor Angela Merkel and Greek Prime Minister Alexis Tsipras attend an EU meeting in Brussels next week.

In the US, Unemployment Claims rose to 278 thousand, up from 265 thousand in the previous release. Still, the reading beat the forecast of 287 thousand. On Wednesday, ADP Nonfarm Employment Change was well off expectations, falling to 213 thousand. The estimate stood at 224 thousand. We could see some stronger movement in gold prices on Friday, with the release of Nonfarm Employment Claims and the Unemployment Rate. Meanwhile, the trade deficit ballooned to $46.6 billion, compared to $39.0 billion a month earlier. This marked the largest trade deficit since May.

XAU/USD for Thursday, February 5, 2015

XAU/USD February 5 at 12:30 GMT

XAU/USD 1267.42 H: 1271.56 L: 1256.81

 

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1215 1240 1255 1275 1300 1322

 

  • XAU/USD moved higher in the Asian session, putting pressure on resistance at 1275. The pair has reversed direction in the European session. Early in North American trade, the pair is unchanged.
  • 1275 remains a weak resistance line. 1300 is stronger.
  • 1255 is an immediate support level. 1240 is next.
  • Current range: 1255 to 1275

Further levels in both directions:

  • Below: 1255, 1240, 1215 and 1200
  • Above: 1275, 1300, 1322, 1345 and 1375

 

OANDA’s Open Positions Ratio

XAU/USD ratio is pointing to gains in long positions on Thursday, continuing the trend seen a day earlier. This is not consistent with the pair’s movement as gold has posted slight losses. The ratio has a majority of long positions, indicating trader bias towards gold reversing directions and moving to higher ground.

XAU/USD Fundamentals

  • 12:30 US Challenger Job Cuts. Actual 17.6%.
  • 13:30 US Trade Balance. Estimate -38.2B. Actual -46.6B.
  • 13:30 US Unemployment Claims. Estimate 287K. Actual 278K.
  • 13:30 US Preliminary Nonfarm Productivity. Estimate 0.3%. Actual -1.8%.
  • 13:30 US Preliminary Unit Labor Costs. Estimate 1.3%. Actual 2.7%.
  • 15:30 US Natural Gas Storage. Estimate -119B.

*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.