Gold continues to lose ground in the Wednesday session. In North American trade, the spot price for one ounce is $1208.90. On the release front, ADP Nonfarm Employment Change soared to 298 thousand, well above the estimate of 184 thousand. On Thursday, the US releases unemployment claims, with the indicator expected to rise to 239 thousand.
It’s been a rough two weeks for gold, which has posted only one winning daily session since February 24. In that time, the metal has dropped 3.8%, and is currently struggling to stay above the symbolic $1200 level. Will gold’s slide continue this week? An excellent ADP employment report has pushed gold lower on Wednesday, and the dollar’s rally could continue if unemployment claims and nonfarm payrolls follow suit with strong gains.
Donald Trump and his new administration continues to create controversy on an almost basis, much to the consternation of the markets. Still, the dollar hasn’t skipped a beat and remains at high levels against its major rivals as well as gold. The dollar has benefited from a strong economy and the increasing likelihood of a rate hike at the upcoming Fed policy meeting on March 15. The likelihood of a March hike has jumped to 84%, according to the CME group, compared to 33% just a week ago. The markets will be listening closely to Fed policymakers ahead of next week’s meeting, and further hints of a March move would likely prop up the US dollar.
Wednesday (March 8)
- 8:15 US ADP Nonfarm Employment Change. Estimate 184K. Actual 298K
- 8:30 US Revised Nonfarm Productivity. Estimate 1.5%. Actual 1.3%
- 8:30 US Revised Unit Labor Costs. Estimate 1.6%. Actual 1.7%
- 10:00 US Final Wholesale Inventories. Estimate -0.1%
- 10:30 US Crude Oil Inventories. Estimate 1.1M. Actual 8.4M
- 13:01 US 10-y Bond Auction
Thursday (March 9)
- 8:30 US Unemployment Claims. Estimate 239K
*All release times are GMT
*Key events are in bold
XAU/USD for Wednesday, March 8, 2017
XAU/USD March 8 at 13:30 EST
Open: 1216.12 High: 1218.61 Low: 1206.49 Close: 1208.90
- XAU/USD was flat in the Asian and European sessions and has posted sharp losses in North American trade
- 1199 is providing support
- 1232 is the next line of resistance
- Current range: 1199 to 1232
Further levels in both directions:
- Below: 1199, 1174 and 1146
- Above: 1232, 1260, 1285 and 1307
OANDA’s Open Positions Ratio
XAU/USD ratio remains unchanged this week. Currently, long positions have a majority (66%), indicative of trader bias towards XAU/USD reversing directions and moving upwards.
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.