- Bulls regain majority of open positions in the market
- Wednesday's drop below 1,115 may trigger losses down to 1,100
- Daily indicators suggest the bullion is too oversold at the moment
- Economic events to watch in the next 24 hours: Spanish, Italian, French, German, UK and Euro zone Manufacturing PMI (Sep); US ISM Manufacturing PMI (Sep); Unemployment Claims (Sep 25) and Total Vehicle Sales (Sep); FOMC Member Williams Speaks; Swiss Retail Sales (Aug); Australian Retail Sales (Aug)
American companies increased the pace of job creation in September, according to the data released by the ADP Research Institute on Wednesday. Employment climbed by 200,000 last month, up from a revised 186,000 in August. The indicator has also overcome estimates for hiring gains of 190,000 in September. Continuing improvement of US economy helped to step up additions to companies' headcount as they benefited from healthy inland demand, even though some companies faced challenged overseas and especially in China. By sectors of employment, the fastest advance was registered in trade and transportation industry. Construction and business services followed, while manufacturing posted the sharpest decline since 2010 by around 15,000 in September.
Meanwhile, Switzerland's leading economic barometer from Zurich-based KOF showed a minor drop in September, official data revealed on Wednesday. The indicator is set to predict economic development for the upcoming six months. In September, the KOF index tumbled 0.8 points to 100.4 from an upwardly revised 101.2 points in the preceding month. The figure failed to match analysts' forecasts of 100.9 points for the reporting month.
Upcoming fundamentals: Australian retail sales to rebound in August
Analysts expect the retail sales in Australia to grow by 0.4% in August on a monthly basis, following a drop of 0.1% in the preceding month. This data is due at 1:30 GMT tomorrow morning. In addition to that, the bunch of US fundamentals will be released in course of the next 24 hours. It will include ISM Manufacturing PMI at 14:00 GMT, unemployment claims for the week ended Sep 25 at 12:30 GMT and car sales' numbers for the month of September at 17:30 GMT.
Gold closes below 1,115, shifts attention to 1,100
The bullion continued to under-perform on Wednesday, while prolonging the period of daily losses to four consecutive working days. Moreover, the metal closed below both 55-day SMA and 23.6% Fibonacci retracement of the Aug-Sep downtrend, meaning that outlook is deteriorating. We expect the core bearish attention to be focused on the major 1,100 level, which is reinforced by the long term downtrend and lower Bollinger band. Intermediate support is represented by the weekly S2 at 1,105. Despite that, daily studies assume gold is oversold at the moment and a rebound is approaching.Daily chart
The one-hour chart does not support any idea of a recovery at the moment. The price is located well below the majority of important technical levels including the 200-hour SMA, currently at 1,132. The only reliable demand can be found as low as 1,100, down $12-14 from the current spot price at the moment of writing.
Hourly chart
SWFX sentiment rebounds, bulls regain majority
On the other hand, OANDA bullish share jumped by almost five percentage points to 69% in the past 24 hours, while SAXO Bank traders are keeping 65% of bullish trades at the moment.