Gold slips despite soft U.S. numbers, investors remain concerned about economy

Gold has posted considerable losses on Tuesday, erasing the gains seen on Monday. In North American trade, the spot price for one ounce of gold is $1334.52, down 0.56% on the day. In economic news, building permits slowed to 1.30 million, shy of the estimate of 1.32 million. Housing starts also slowed, falling to 1.16 million, down from 1.23 million in the previous release. There was more bad news, as CB consumer confidence fell sharply to 124.1, well below the estimate of 132.1 points.

U.S. data was softer than expected on Tuesday, but gold failed to take advantage. Gold gained ground last week and posted more gains on Monday, as risk apprehension has since the Federal Reserve policy meeting last week. At the meeting, policymakers were sharply dovish, indicating that the Fed planned to hold interest rates for the remainder of the year. As well, the Fed lowered its growth forecast for 2019 to 2.1%, down from 2.3% in December. There was more bad news on Friday, as the spread between 3-month and 10-year Treasury notes turned negative for the first time since 2007, pointing to an inverted yield curve, which could point to a recession. All eyes will be on U.S. Final GDP, which will be released on Thursday. If GDP misses the forecast of 2.4%, investors could get jittery and flee to the gold, a traditional safe-haven asset.

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XAU/USD Fundamentals

Tuesday (March 26)

  • 6:30 US FOMC Member Evans Speaks
  • 8:30 US Building Permits. Estimate 1.32M. Actual 1.30M
  • 8:30 US Housing Starts. Estimate 1.22M. Actual 1.16M
  • 9:00 US HPI. Estimate 0.4%. Actual 0.6%
  • 9:00 US S&P/CS Composite-20 HPI. Estimate 4.3%. Actual 3.6%
  • 9:59 US Richmond Manufacturing Index. Estimate 12. Actual 10
  • 10:00 US CB Consumer Confidence. Estimate 132.1. Actual 124.1

*All release times are EST

*Key events are in bold

XAU/USD for Tuesday, March 26, 2019

XAU/USD March 26 at 12:30 DST

Open: 1321.88 High: 1323.32 Low: 1312.80 Close: 1314.52

XAU/USD Technical

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

XAU/USD edged lower in European trade and posted more losses in Asian trade. XAU/USD is showing limited movement 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 1243
  • 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

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.