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XAU/USD – Gold Climbs Ahead of Fed Announcement

Gold has posted strong gains in the Tuesday session, climbing one percent. In North American trade, the metal is trading at a spot price of $1290.49 per ounce. On the release front, ISM Manufacturing PMI came in at 51.9 points, edging above the forecast of 51.8 points. On Wednesday, the Federal Reserve concludes its monthly policy meeting and is expected to maintain the benchmark interest rate at 0.25 percent. As well, the US releases ADP Employment Change, which precedes the official Nonfarm Employment change report on Friday.

In the US, there was positive news from the consumer front on Monday, as Personal Spending rebounded with a 0.5% gain in September, after a flat reading of 0.0% in August. Gold responded to the reading with slight losses. This release comes on the heels of a disappointing consumer spending report on Friday, as UoM Consumer Sentiment fell to 87.2 points in October, below expectations and dropping to its lowest level since August 2015.  The Fed will also hold a policy meeting on Wednesday, but the markets aren’t expecting a rate move so close to the US presidential election. The rate statement will be carefully monitored, as analysts comb for hints about the extent of support among FOMC members ahead of the crucial December meeting.

XAU/USD Fundamentals

Tuesday (November 1)

Wednesday (November 2)

*All release times are EDT

*Key events are in bold

XAU/USD for Tuesday, November 1, 2016

XAU/USD November 1 at 12:40 EDT

Open: 1276.06 High: 1290.79 Low: 1275.63 Close: 1290.49

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1223 1245 1279 1290 1307 1331

Further levels in both directions:

OANDA’s Open Positions Ratio

XAU/USD ratio is showing slight gains in short positions. Currently, long positions command a substantial majority (71%), indicative of trader bias towards XAU/USD continuing to move higher.

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 [4]

Market Analyst at OANDA [5]
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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