Gold rebounds as jobless claims miss expectations

Gold has posted gains in the Thursday session. In North American trade, the spot price for one ounce of gold is $1310.70, up 0.32% on the day. In economic news, there was just one key event. Unemployment claims dropped to 234 thousand, but this was above the estimate of 220 thousand.

The Federal Reserve does not hold its policy meeting until mid-March, so investors will be left to focus on remarks from Fed Chair Jerome Powell and his colleagues. The Fed raised interest rates four times last year, but economic conditions are very different in 2019. The U.S-China trade war has dampened global growth and rocked the equity markets. With the U.S. unlikely to replicate the sparkling growth we saw in 2018, the Fed is projecting just two rate increases this year. The markets, however, are predicting no rate moves, and some analysts are even talking about the possibility of a rate cut late in 2019.

President Trump’s State of the Union address was a yawner as far as the markets were concerned, but there were some points of interests for investors. Trump spoke about the U.S-China trade war, reiterating that the U.S. would demand “real structural change” from China before a trade deal could be reached. American policymakers have long demanded that China desist from intellectual theft against U.S. companies, and with China experiencing a slowdown, the Chinese may have to make concessions or face further tariffs in March. A third round of negotiations between the sides is scheduled for this month, raising hopes that the U.S. will not impose further tariffs on China in early March. Trump also announced that he will meet North Korean leader Kim in late February, an event which could bolster risk appetite and weigh on gold prices.

Antipodes Action Overnight; Don’t Dream It’s Over?

EU agrees to work with British PM on Brexit demands

Sterling recovers early losses on Carney optimism

XAU/USD Fundamentals

Thursday (February 7)

  • 8:30 US Unemployment Claims. Estimate 220K. Actual 234K
  • 9:30 US FOMC Member Clarida Speaks
  • 10:30 US Natural Gas Storage. Estimate -228B
  • 13:01 US 30-year Bond Auction
  • 15:00 US Consumer Credit. Estimate 16.5B
  • 19:30 US FOMC Member Bullard Speaks

*All release times are EST

*Key events are in bold

XAU/USD for Thursday, February 7, 2019

XAU/USD February 7 at 12:45 EST

Open: 1306.51 High: 1311.96 Low: 1302.89 Close: 1310.70

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1261 1284 1306 1326 1344 1365

XAU/USD edged lower in the Asian session. The pair posted considerable gains in the European session and is up slightly in North American trade

  • 1306 is providing support
  • 1326 is the next resistance line
  • Current range: 1306 to 1326

Further levels in both directions:

  • Below: 1306, 1284, 1261 and 1236
  • Above: 1326, 1344 and 1365

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

Market Analyst at OANDA
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, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

Latest posts by Kenny Fisher (see all)