Gold Unchanged Ahead of US Housing Data

Gold has posted small gains on Monday, as the spot price is $1164 per ounce at the start of the North American session. In economic news, the day’s only event is US New Home Sales, with the markets expecting the indicator to slip to 546 thousand. We’ll get a look at two market-mover events on Tuesday in the US – Core Durable Goods Orders and CB Consumer Confidence.

There was positive news out of the US on Thursday, as Unemployment Claims, a key release, came in at 259 thousand, beating the estimate of 266 thousand. This was slightly higher than the previous reading of 255 thousand, but marked the third straight week that the indicator beat the forecast. The four-week moving average of claims, which reduces the volatility of the weekly jobless reports, is currently at its lowest level since 1973. These figures point to a stronger labor market, but the next big test comes in early November, with the publication of Nonfarm Payrolls. Meanwhile, Existing Housing Sales had a banner September, improving to 5.55 million, crushing the estimate of 5.38 million. We’ll get a look at New Housing Sales later on Monday.

Recent US data has not been has strong as hoped, with key numbers sending a mixed message about the health of the economy. This has reduced the likelihood of a rate hike by the Federal Reserve before the end of 2015. The markets remain frustrated about the Fed’s lack of communication with the markets, as FOMC members continue to send out contradictory messages about the Fed’s plans. Still, an improvement in US numbers, especially employment and consumer indicators, could quickly revive speculation about a rate hike and boost the US dollar. Stay tuned for a busy week, as the Federal Reserve issues a policy statement after its monthly meeting. This will be followed by the release of the Advance GDP report, a key event.

XAU/USD Fundamentals

Monday (Oct. 26)

14:00 US New Home Sales. Estimate 546K

Upcoming Events

Tuesday (Oct. 27)

• 12:30 US Core Durable Goods Orders. Estimate 0.0%
• 14:00 US CB Consumer Confidence. Estimate 102.5 points

*Key releases are highlighted in bold

*All release times are GMT

XAU/USD for Monday, October 26, 2015

USD/CAD October 26 at 12:45 GMT

USD/CAD 1164 H: 1168 L: 1165

XAU/USD Technical

• XAU/USD has been uneventful in the Asian and European sessions.
• On the downside, 1162 is under strong pressure and could be tested during the day.
• 1180 is an immediate resistance line.
• Current range: 1162 to 1180

Further levels in both directions:

• Below: 1162, 1151 and 1134
• Above: 1180, 1192 and 1204

OANDA’s Open Positions Ratio

XAU/USD ratio is unchanged on Monday, as long and short positions are close to an even split (52:48),  indicative of a lack of trader bias regarding which direction gold will take next.

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.