Gold prices remain close to the key $1200 level, as the metal is trading at a spot price of $1198.60 on Tuesday. In the US, Federal Reserve head Janet Yellen will testify before the Senate Banking Committee. As well, the US releases the CB Consumer Confidence report. The markets are expecting a strong reading, with a forecast of 99.6 points.
The Greek bailout saga continues, as Greece and its creditors try to find some common ground on a bailout extension. Greece was granted a four-month extension on Friday, provided that the country could provide a list of “reform commitments” showing that Greece would continue to reform its economy. Greece’s creditors will review the proposals on Tuesday before giving their approval to the extension. Even if this occurs, the extension is a stop-gap measure and the bailout crisis is far from over.
The markets will be keeping a close eye on Federal Reserve chair Janet Yellen, who testifies before the Senate Banking Committee later on Tuesday. Last week’s Fed minutes were dovish in stance, as policymakers expressed concern about a mid-year rate hike hurting the US recovery. What will be Yellen’s take on a rate hike? If Yellen does provide any hints in this regard, we could see some movement from gold prices.
US releases started the week on a sour note, as Existing Home Sales slipped to 4.82 million in January, well off the estimate of 5.03 million. This marked a 9-month low for the key indicator. We’ll get a look at New Home Sales on Wednesday. Late last week, US key numbers were mixed. Unemployment Claims rebounded strongly with a sharp drop of 283 thousand, compared to 304 thousand a week earlier. This easily beat the estimate of 293 thousand. The news was not as good from the Philly Fed Manufacturing Index, which slipped to 5.2 points, down from 5.3 points and a third straight drop. The markets had expected a reading of 8.8 points.
XAU/USD for Tuesday, February 24, 2015
XAU/USD February 24 at 11:20 GMT
XAU/USD 1198.60 H: 1204.65 L: 1194.68
- XAU/USD is steady and continues to trade close to the key 1200 line.
- 1200 is a weak resistance line and remains under pressure. 1215 is next.
- 1175 is an immediate support level.
- Current range: 1175 to 1200
Further levels in both directions:
- Below: 1175, 1154 and 1131 and 1111
- Above: 1200, 1215, 1240, 1255 and 1275
OANDA’s Open Positions Ratio
XAU/USD ratio is pointing to gains in short positions on Tuesday. This is consistent with the pair’s movement, as gold has posted small losses. The ratio has a majority of long positions, indicating trader bias towards gold moving to higher ground.
- 14:00 US S&P/Composite-20 HPI. Estimate 4.5%.
- 14:45 US Flash Services PMI. Estimate 54.5 points.
- 15:00 US CB Consumer Confidence. Estimate 99.6 points.
- 15:00 US Federal Reserve Janet Yellen Testifies.
- 15:00 US Richmond Manufacturing Index. Estimate 7 points.
*Key releases are highlighted in bold
*All release times are GMT