Gold ticks lower, ADP nonfarm payrolls slide

Gold is steady on Wednesday. In North American trade, the spot price for one ounce of gold is $1291.40, down 0.07% on the day. On the release front, employment and services data was softer than expected. ADP nonfarm payrolls plunged to 129 thousand, down from 183 thousand in the previous release. ISM Non-Manufacturing PMI also stumbled, falling from 59.7 to 56.1 points. On Thursday, the U.S. releases unemployment claims.

Soft U.S. numbers this week have raised concerns about the strength of the U.S. economy, but gold hasn’t taken advantage. The Non-Manufacturing PMI slowed considerably, although it still pointed to expansion. Durable goods orders plunged 1.6%, and retail sales fell by 0.2%. Analysts are keeping an eye on GDP, and there are growing worries that first quarter numbers could be dismal. Growth for the first quarter could be as low as 0.8% annualized, compared to 2.2% in the fourth quarter.

Gold started the week with losses, as positive news out of China raised risk appetite and made gold less attractive. Chinese Caixin Manufacturing PMI improved to 50.8, easily beating the estimate of 50.1 points. Investors cheered as the indicator climbed to an 8-month high, after three successive readings in contraction territory. The Chinese economy has been hit hard by the trade war with the U.S., and the Chinese PMI has raised hopes that China could be pulling out of its economic slowdown.

European open – Markets off to a bright start

Pound sterling in the shop window

XAU/USD Fundamentals

Wednesday (April 3)

  • 8:15 US ADP Nonfarm Employment Change. Estimate 184K. Actual 129K
  • 10:00 US ISM Non-Manufacturing PMI. Estimate 58.1. Actual 56.1
  • 10:30 US Crude Oil Inventories. Estimate -0.7M. Actual 7.2M

Thursday (April 4)

  • 8:30 US Unemployment Claims. Estimate 215K

*All release times are DST

*Key events are in bold

XAU/USD for Wednesday, April 3, 2019

XAU/USD April 3 at 12:30 DST

Open: 1287.74 High: 1291.93 Low: 1258.37 Close: 1291.77

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1243 1261 1284 1306 1326 1344

XAU/USD ticked higher in the Asian session but retracted in the European session. The pair has edged lower in North American trade

  • 1284 is providing support
  • 1306 is the next resistance line
  • Current range: 1284 to 1306

Further levels in both directions:

  • Below: 1284, 1261 and 1243
  • Above: 1306, 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)