Gold gains ground as risk apprehension remains high

Gold has posted considerable gains in the Monday session. In North American trade, the spot price for one ounce of gold is $1242.03, up 0.44% on the day. It’s a quiet start to the week, with just one event on the schedule. JOLTS Job Openings improved to 7.08 million, but was well short of the estimate of 7.22 million. On Tuesday, the U.S. releases Producer Price Index reports.

It was a good week for gold, which has benefited from the sharp downturn in global equity markets. Gold jumped 2.15%, as jittery investors have flocked to safe-haven assets like gold. On Monday, gold broke above the $1250 level for the first time since July.

Gold moved higher on Friday, in response to disappointing November employment numbers. Nonfarm employment change was weaker than expected, plunging from 250 thousand to 155 thousand. This was well off the forecast of 198 thousand. Wage growth remained stuck at 0.2%, missing the estimate of 0.3%. There was better news from the unemployment rate, which remained at a sizzling 3.7%. The data points to slowing growth in the U.S, which could lead to a change in monetary policy. The Federal Reserve minutes from the November meeting indicated that policymakers discussed changing their stance of gradual increases rate increases. A few months ago, there was talk of up to four rate increases in 2019, but that has changed to just one rate hike next year, as the U.S economy is showing signs of slowing down, including weaker GDP readings and the soft job numbers.

XAU/USD Fundamentals

Monday (December 10)

  • 10:00 US JOLTS Openings. Estimate 7.22M. Actual 7.01M

Tuesday (December 11)

  • 8:30 US PPI. Estimate 0.0%
  • 8:30 US Core PPI. Estimate 0.1%

*All release times are EST

*Key events are in bold

XAU/USD for Monday, December 10, 2018

XAU/USD December 10 at 12:20 EST

Open: 1248.08 High: 1251.04 Low: 1243.54 Close: 1244.86

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1204 1220 1236 1261 1284 1306

XAU/USD showed little movement in the Asian session. The pair ticked lower in the European session and is steady in North American trade

  • 1236 is providing support
  • 1261 is the next resistance line
  • Current range: 1236 to 1261

Further levels in both directions:

  • Below: 1236, 1220, 1204 and 1170
  • Above: 1261, 1284 and 1306

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.