Gold dips as unemployment claims sparkle

Gold has posted losses in the Thursday session, erasing much of the gains seen on Wednesday. In North American trade, the spot price for one ounce of gold is $1202.31, down 0.33% on the day. In the U.S, key consumer inflation reports missed their estimates. CPI came in at 0.2%, shy of the estimate of 0.3%. Core CPI dipped lower to 0.1%, missing the forecast of 0.2%. Unemployment claims sparkled with a reading of 204 thousand, beating the forecast of 214 thousand. On Friday, the U.S release retail sales and UoM Consumer Sentiment.

In the U.S, the red-hot labor market continues to be the envy of industrialized countries around the globe. The unemployment rate is at a remarkable 3.8% and unemployment claims were almost unchanged at 204 thousand, another excellent reading. Despite the strong employment front and a booming economy, inflation remains well short of the Federal Reserve’s target of 2 percent. In August, CPI and Core CPI came in at 0.1% and 0.2%, respectively, falling short of their estimates.

Gold prices continue to hover close to the symbolic $1200 level, which has been the case for much of the time since late August. The base metal has failed to take advantage of soft consumer inflation numbers on Thursday. However, we could see gold prices rise on Friday, if retail sales reports are weaker than expected. Retail sales, the primary gauge of consumer spending, is expected to dip to 0.4% in August, down from 0.5% in July.

XAU/USD Fundamentals

Thursday (September 13)

  • 8:30 US CPI. Estimate 0.3%. Actual 0.2%
  • 8:30 US Core CPI. Estimate 0.2%. Actual 0.1%
  • 8:30 US Unemployment Claims. Estimate 210K. Actual 204K
  • 10:00 US FOMC Member Randal Quarles Speaks
  • 10:30 US Natural Gas Storage. Estimate 65B. Actual 69B
  • 13:01 30-year Bond Auction
  • 13:15 US FOMC Member Raphael Bostic Speaks
  • 14:00 US Federal Budget Balance. Estimate -169.8B

Friday (September 14)

  • 8:30 US Core Retail Sales. Estimate 0.5%
  • 8:30 US Retail Sales. Estimate 0.4%
  • 8:30 US Import Prices. Estimate -0.2%
  • 9:15 US Capacity Utilization Rate. Estimate 78.3%
  • 9:15 US Industrial Production. Estimate 0.3%
  • 10:00 US Preliminary UoM Consumer Sentiment. Estimate 96.7
  • 10:00 US Business Inventories. Estimate 0.5%
  • 10:00 US Preliminary UoM Inflation Expectations

*All release times are DST

*Key events are in bold

XAU/USD for Friday, September 13, 2018

XAU/USD September 13 at 12:30 DST

Open: 1206.15 High: 1212.67 Low: 1201.61 Close: 1202.31

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1115 1146 1170 1204 1220 1236

XAU/USD edged lower in the Asian session but recovered in European trade. The pair posted gains in North American trade but has reversed directions and headed lower

  • 1170 is providing support
  • 1204 is fluid. Currently, it is a weak resistance line
  • Current range: 1170 to 1204

Further levels in both directions:

  • Below: 1170, 1146 and 1115
  • Above: 1204, 1220, 1236 and 1261

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

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.