Gold jumps as US dollar shows broad losses

Gold has posted sharp gains in the Thursday session, after sustaining strong losses this week. In the North American trade, the spot price for one ounce of gold is $1232.51, up 1.47% on the day. On the release front, unemployment claims ticked lower to 214 thousand, a shade above the forecast of 213 thousand. On the manufacturing front, ISM Manufacturing PMI also disappointed, as it fell to 57.7 points, shy of the estimate of 59.0 points. This marked a 6-month low. On Friday, the focus will be on U.S employment numbers, with the release of wage growth and nonfarm payrolls.

October may have been dismal for the stock markets, but gold prices were sharply higher, posting a gain of 1.75%. This marked the strongest monthly gain since July 2017. With global stock markets rebounding on Thursday, investors have regained confidence and risk appetite. This has weighed on the U.S dollar, which has taken advantage of the recent turmoil in the equity markets and posted impressive gains. A lower dollar on Thursday has pushed gold prices sharply higher. Traders should be prepared for volatility from gold on Friday, with the release of key employment indicators. Nonfarm payrolls are expected to improve sharply to 193 thousand, but wage growth is forecast to tick lower to 0.2%.

XAU/USD Fundamentals

Thursday (November 1)

• 7:30 US Challenger Job Cuts. Actual 153.6%
• 8:30 US Preliminary Productivity. Estimate 2.2%. Actual 2.2%
• 8:30 US Preliminary Unit Labor Costs. Estimate 1.1%. Actual 1.2%
• 8:30 US Unemployment Claims. Estimate 213K. Actual 214K
• 9:45 US Final Manufacturing PMI. Estimate 55.9. Actual 55.7
• 10:00 US ISM Manufacturing PMI. Estimate 59.0. Actual 57.7
• 10:00 US Construction Spending. Estimate 0.2%. Actual 0.0%
• 10:00 US ISM Manufacturing Prices. Estimate 67.5. Actual 71.6
• 10:30 US Natural Gas Storage. Estimate 53B. Actual 48B
• All Day – US Total Vehicle Sales. Estimate 17.1M

Friday (November 2)

• 8:30 US Average Hourly Earnings. Estimate 0.2%
• 8:30 US Nonfarm Employment Change. Estimate 193K
• 8:30 US Unemployment Rate. Estimate 3.7%

*All release times are DST

*Key events are in bold

XAU/USD for Thursday, November 1, 2018

XAU/USD November 1 at 12:25 DST

Open: 1214.65 High: 1233.70 Low: 1214.65 Close: 1232.51

XAU/USD Technical

XAU/USD ticked higher in the Asian session. The pair posted considerable losses in European trade and continues to move higher in the North American session

• 1220 is providing support
• 1236 is the next resistance line
• Current range: 1220 to 1236

Further levels in both directions:

• Below: 1220, 1204, 1170 and 1146
• Above: 1236, 1261 and 1284

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.