Gold dips on profit-taking, U.S GDP looms

Gold has posted losses for a second successive day. In Wednesday’s North American session, the spot price for one ounce of gold is $1311.80, down 0.29% on the day. In economic news, there are no major U.S. releases. On Thursday, the U.S. releases Final GDP and unemployment claims.

After a sharply dovish Fed meeting last week, investors are in a sour mood. The Fed said that it had no plans to raise rates before 2019, and also lowered its growth forecast for 2019 to 2.1%, down from 2.3% in December. As well, the spread between 3-month and 10-year Treasury notes turned negative on Friday, signifying the dreaded inverted yield curve. This curve has preceded every U.S. recession over the past 60 years, so it’s no surprise that this has caused consternation among investors. Gold posted considerable gains late last week, but was unable to consolidate and coughed up those gains this week.

All eyes are on the Final GDP for the fourth quarter, which will be released on Thursday. The economy is expected to post a gain of 2.4%. The February reading for GDP came in at 2.6%, above the forecast of 2.2%. Traders should treat the GDP release as a market-mover.

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XAU/USD Fundamentals

Wednesday (March 27)

  • 8:30 US Trade Balance. Estimate -57.2B. Actual -51.1B
  • Tentative – US Current Account. Estimate -130B
  • 10:30 US Crude Oil Inventories. Estimate -1.1M
  • 17:30 US FOMC Member George Speaks

Thursday (March 28)

  • 8:30 US Final GDP. Estimate 2.4%
  • 8:30 US Unemployment Claims. Estimate 222K

*All release times are EST

*Key events are in bold

XAU/USD for Wednesday, March 27, 2019

XAU/USD March 27 at 12:50 DST

Open: 1315.55 High: 1319.36 Low: 1308.96 Close: 1311.80

XAU/USD Technical

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

XAU/USD posted slight gains in Asian trade but then retracted. This pattern was repeated in the European session. XAU/USD has edged lower 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

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Kenny Fisher

Kenny Fisher

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental and macroeconomic analysis, Kenny Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in major online financial publications including, Seeking Alpha and FXStreet. Kenny has been a MarketPulse contributor since 2012.