Gold edges higher, U.S retail sales climb

Gold has posted slight gains in the Thursday session. In North American trade, the spot price for one ounce of gold is $1213.47, up 0.19% on the day. On the release front, consumer spending data was strong. Retail sales rebounded with a strong gain of 0.7% in October, after a decline of -0.1% a month earlier. Core retail sales jumped 0.8%, after a gain of 0.1% in September. Elsewhere, the Philly Fed Manufacturing Index fell sharply to 12.9, shy of the estimate of 20.1 points. Unemployment claims edged higher to 216 thousand, above the estimate of 213 thousand. This was the highest reading since August.

After sustaining losses of close to 2.0% last week, gold has held steady this week. Consumer inflation and spending data has been strong this week, as CPI and retail sales reports pointed to improvement in October. The numbers underscore a strong U.S economy, which means that the Fed remains on track to continue raising interest rates. The markets expect four rate hikes this year, followed by another three or four hikes in 2020. The steady drip of rate hikes is bullish for the U.S dollar, and conversely, could weigh on gold prices.

On Wednesday, U.S consumer inflation numbers beat their estimates for October. The consumer price index posted a gain of 0.3%, its strongest gain since January. Core CPI, which excludes food and energy prices edged higher to 0.2%, marking a 3-month high. Both releases were in line with forecasts. Core CPI was 2.1% higher than a year ago, and this solid release means that the Fed remains on track to continue raising interest rates. The Federal Reserve holds its next policy meeting in December, with the odds of a December rate hike at 72%, according to the CME Group.

XAU/USD Fundamentals

Thursday (November 15)

  • 8:30 US Core Retail Sales. Estimate 0.5%. Actual 0.7%
  • 8:30 US Retail Sales. Estimate 0.6%. Actual 0.8%
  • 8:30 US Philly Fed Manufacturing Index. Estimate 20.1. Actual 12.9
  • 8:30 US Empire State Manufacturing Index. Estimate 19.9. Actual 23.3
  • 8:30 US Import Prices. Estimate 0.1%. Actual 0.5%
  • 8:30 US Unemployment Claims. Estimate 213K. Actual 216K
  • 10:00 US FOMC Member Quarles Speaks
  • 10:00 US Business Inventories. Estimate 0.3%. Actual 0.3%
  • 10:30 US Natural Gas Storage. Estimate 35B
  • 11:00 US Crude Oil Inventories. Estimate 2.9M
  • 11:30 US Fed Chair Powell Speaks
  • 13:00 US FOMC Member Bostic Speaks

*All release times are EST

*Key events are in bold

XAU/USD for Thursday, November 15, 2018

XAU/USD November 15 at 12:30 DST

Open: 1211.12 High: 1216.58 Low: 1213.47 Close: 1213.47

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1122 1146 1170 1204 1220 1236

XAU/USD posted gains in the Asian session but retracted in European trade. The pair has moved upwards in North American session

  • 1170 is providing support
  • 1204 is fluid. It is a weak resistance line
  • Current range: 1170 to 1204

Further levels in both directions:

  • Below: 1170, 1146 and 1122
  • Above: 1204, 1220, 1236 and 1261

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 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.