- 56% of all SWFX open positions are long
- Gold opened Tuesday's session at 1,258.94
- The 1,250 psychological level stopped the metal's fall
- Economic events to watch over the next 24 hours: US NFIB Small Business Index; US Labor Market Conditions Index
US employment growth slowed unexpectedly last month, official data revealed on Friday. According to the US Department of Labor, US private companies created 156,000 new jobs in September, while market analysts expected the economy to add 171,000 jobs in the reported month. Meanwhile, the previous month's reading was revised up to 167,000 from the originally reported gain of 151,000. Although the report suggested the economic expansion was still remaining on track, the chances of an interest rate hike at the Federal Reserve's policy meeting next month decreased markedly. However, the odds of a December rate remained quite high, despite the disappointing, despite today's disappointing jobs report. The unemployment rate grew to 5.0% in September, as more Americans re-joined the labor force. Average hourly wages rose to an annualized rate of 2.6% last month, in line with analysts' expectations, whereas the average work week grew 0.1 to 34.4 hours. A broader measure of unemployment, which includes part-time workers and people who stopped searching for jobs, held steady at 9.7% in September. Professional and job services created 67,000, health care and restaurants added 33,000 and 30,000 jobs, respectively, contributing most to the September job growth.
The number of Americans filing for unemployment benefits dropped to its lowest level in 43 years, official figures revealed on Thursday. According to the US Department of Labor, initial jobless claims fell 5,000 to a seasonally adjusted 249,000 in the week ending October 1, compared to the preceding week's reading of 254,000, while market analysts anticipated a slight rise to 255,000 in the reported period. It was the 83rd consecutive week of initial claims remaining below the 300,000 level, the longest streak since 1973. Furthermore, the four-moving average of claims, considered a better measure of labor market trends, declined 2,500 to 253,000 last week, the lowest level since December of 1973. The data also showed the number of continuing claims decreased 6,000 to 2.058 million in the week ended September 24, while its four-week moving average declined 21,000 to 2.095 million. Meanwhile, analysts expect Friday's NFP report to announce 171,000 new jobs for September and the unemployment rate to remain unchanged at 4.9%. Immediately after the release of initial jobless claims, the US Dollar rose against other major currencies, trading at 1.1179 against the Euro, 1.2641 against the British Pound and 103.89 against the Japanese Yen, while its Index advanced to 96.44.
Upcoming fundamentals: Minor data from the US
Although, the US banking holiday has ended there will be no notable data releases, which might affect the strength of the US Dollar in a noticeable way. However, some economic calendars still note such things as the US NFIB Small Business Index and the US Labor Market Conditions Index. If someone would like to use these indicators for his further analysis of the strength of the US economy, one should delve deep into the methodology of these indices.
Gold meets resistance on Tuesday morning
Daily chart: After slightly surging for the past two trading sessions the yellow metal had slightly depreciated on Tuesday morning. The metal struggles to score gains, as the 200-day SMA is just above it, with the metal around 1,257 level and the SMA around 1,261. Although, the bullion might go either way by the end of the day, as in the case of a breakthrough the metal will face an open way up to the level of 1,272, where the weekly PP and monthly S2 are located at. Secondly, the metal might move lower, if it passes the 1,250 psychological level.Daily chart
Hourly chart: The hourly chart for gold reveals one additional and interesting fact. The previous pattern's lower trend line has begun to provide resistance in the past two trading sessions. In the previous 24 hours the metal was surging until it encountered the before mentioned trend line at 1,264.80, and the bullion bounced off of it. Afterwards, the commodity encountered the 55-hour SMA, which has kept prepping it up during the last 12 hours.
Hourly chart
Traders remain bullish
Meanwhile, OANDA Bank clients remain majorly bullish with respect to the bullion, as on Tuesday morning 73.88% of all positions were long. In the meantime, SAXO bank clients show a similar trend with 64.34% of all positions being held by bulls.