Gold Edges Higher on Disappointing US Employment, Mfg. Numbers

Gold is trading slightly higher in the Thursday session. In North American trading, the spot price for an ounce of gold is $1279.94, up 0.21% on the day. On the release front, unemployment claims jumped to 249 thousand, well above the estimate of 235 thousand. The Philly Fed Manufacturing Index slipped to 22.7 points, short of the forecast of 24.5 points. On Friday, the focus will be on housing data, with the release of Housing Starts and Building Permits.

Investors are keeping a close eye on Congress, where the House of Representatives votes on tax legislation later on Thursday. With the Democrats fiercely against the bill, the House vote is expected to be very close. This is just the first round, as the Senate is working on its own version of a tax bill. President Trump is pushing hard for the legislation, as he desperately wants the Republicans to pass a major piece of legislation before the end of the year.

There were no surprises from key consumer spending and inflation data on Wednesday. CPI and Core CPI matched the forecasts, with gains of 0.1% and 0.2%, respectively. Consumer spending reports were a mix – retail sales gained 0.1%, shy of the estimate of 0.2%. Core Retail Sales came in at 0.2%, beating the forecast of 0.0%. The Federal Reserve would certainly like to see higher inflation numbers, which remain well below the Fed inflation target of 2.0%. Still, the markets are very bullish on additional rate hikes, as the odds of upcoming rate hikes continues to move higher. Currently, the likelihood of a rate hike in December stands at 96%, and a January raise is priced in at 94%.

XAU/USD Fundamentals

Thursday (November 16)

• 8:30 US Unemployment Claims. Estimate 235K. Actual 249K
• 8:30 US Philly Fed Manufacturing Index. Estimate 24.5. Actual 22.7
• 8:30 US Import Prices. Estimate 0.4%. Actual 0.2%
• 9:00 BoE Governor Mark Carney Speaks
• 9:15 US Capacity Utilization Rate. Estimate 76.3%. Actual 77.0%
• 9:15 US Industrial Production. Estimate 0.5%. Actual 0.9%
• 10:00 US NAHB Housing Market Index. Estimate 67. Actual 70
• 10:30 US Natural Gas Storage. Estimate -15B. Actual -18B
• Tentative – US FOMC Member Robert Kaplan Speaks
• 15:45 US FOMC Member Lael Brainard Speaks

Friday (November 17)

• 8:30 US Building Permits. Estimate 1.25M
• 8:30 US Housing Starts. Estimate 1.19M

*All release times are GMT

*Key events are in bold

XAU/USD for Thursday, November 16, 2017

XAU/USD November 16 at 12:20 EST

Open: 1277.26 High: 1281.68 Low: 1275.04 Close: 1279.94

XAU/USD Technical

• XAU/USD showed little movement in the Asian session. The pair edged higher in the European session and is steady in North American trade
• 1260 is providing support
• 1285 is the next resistance line
• Current range: 1260 to 1285

Further levels in both directions:

• Below: 1260, 1240 and 1213
• Above: 1285, 1307, 1337 and 1367

OANDA’s Open Positions Ratio

XAU/USD ratio is showing little movement in the Thursday session. Currently, long positions have a majority (73%), indicative of trader bias towards XAU/USD continuing to move to higher ground.

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.