- SWFX traders are neutral
- 63% of pending commands are to buy the metal
- The bullion opened at 1,247.57
- Upcoming Events: US ISM Manufacturing PMI; FOMC Member Dudley's Speech; FOMC Member Harker's Speech
The US economy expanded at a stronger than initially expected pace during the final quarter of 2016 amid higher consumer spending. The Commerce Department reported on Thursday the economy grew at a 2.1% annualised rate in the Q4 of 2016, compared to the previously estimated 1.9% pace. Nevertheless, for all of 2016, the economy expanded just 1.6%, the slowest pace of growth since 2011, following a 2.6% expansion in 2015. Moreover, the most recent economic indicators suggested that economic growth slowed further in the Q1 of 2017. According to the Atlanta Fed, the US economy expanded at a 1.0% rate in the Q1. However, economists claim that US employment data is more reliable than output data, as it paint a clearer picture of national income growth.
Thursday's data also showed consumer spending advanced 3.5% during the last quarter of 2016, up from the initially reporter 3.0% growth rate. Furthermore, domestic demand climbed 3.4% in the Q4 of 2016, the fastest pace of growth in two years, as imports posted a 9.0% jump, the biggest since the Q4 of 2014. Other data released on Thursday revealed that initial jobless claims dropped 3,000 to a seasonally adjusted 258,000 in the week ending March 25, remaining below the 300,000 level for 108 consecutive weeks.
Upcoming events: ISM PMI and Fed speeches
On Monday there are few notable events scheduled, which trader might take into account. First of all at 14:00 GMT the ISM Manufacturing PMI is set to be released. This is the most important data release during the day, as it is the only one, which might cause volatility in the markets. At 14:30 GMT FOMC member Dudley is set to give a speech. In the evening, at 19:00 GMT, another speech by a FOMC member will take place, as Harker is set to speak publicly.
Gold attempts to break above 1,250
Daily chart: On Monday morning the yellow metal attempted to break above the 1,250 mark, as it faced resistance put up by the weekly PP at 1,249.67 and the 50.00% Fibonacci retracement level, which is located at the 1,248.96 mark. If the bullion succeeds, it will likely jump to the 1,257.02 level, where the 200-day SMA is located at. However, in the case of a failure the commodity price has no support as low as the 1,238.33 level, where the weekly S1 is positioned. The weekly S1 is also supported by the freshly calculated monthly PP at the 1,234.74 level.Daily chart
Hourly chart: The hourly chart indicates two things. First of all the declining channel pattern was broken during the attempt to move higher. Secondly, the attempt to pass the 1,250 mark has already failed. Various hourly SMAs gave a hand to the larger timeframe levels of significance, and combined together the resistance stopped the surge, as by 8:00 GMT the commodity price had already fallen to the 1,245 level.
Hourly chart
Markets remain bullish
OANDA Gold traders remain with a bullish outlook, as open positions are 54.96% long on Monday, compared to 57.08% previously. Meanwhile, traders of SAXO bank have decreased the percentage of long positions, as 54.75% of open positions are long, compared to 57.15% on Friday.