- 52% of all SWFX open positions are short
- Prices fluctuate around the 1,340 level since August 4
- Economic events to watch over the next 24 hours: US New Home Sales (July); US PMI Manufacturing (Aug)
Initial jobless claims posted a surprise fall, fresh data revealed on Thursday. According to the Department of Labor, the number of Americans filing for unemployment benefits dropped to 262,000 in the week ended August 13, following the preceding week's reading of 266,000, whereas market analysts pencilled in a slight increase to 269,000 in the reported period. Four weeks ago, claims hit the 43- year low of 248,000 touched in mid-April. Last week's data marked the 76th consecutive week of initial jobless claims below the 300,000 level, the longest streak since 1973. Meanwhile, the fourweek moving average, considered a better measure of labour market trends, jumped 2,500 to 265,250 in the week ending August 13. Other data released on Thursday showed an unexpectedly large improvement of business activity in the US mid-Atlantic region. According to the Philadelphia Federal Reserve's survey, the manufacturing activity index rose to 2.0 points in August, after dropping 2.9 in the preceding month, while economic desks anticipated an increase to 1.2 in the reported month. Furthermore, the survey's six-month outlook indicator grew to 45.8 in August from last month's 33.7, posting the highest reading since January 2015. The survey tracks business activity in eastern Pennsylvania, southern New Jersey, and Delaware. The Philly Fed index is seen as one of the first monthly indicators of the health of the US economy.
Canadian consumer prices grew less than expected in July, fresh data revealed on Friday. According to Statistics Canada, the central bank's core Consumer Price Index (CPI) came in at 0.0% on a monthly basis and at 2.1% on an annual basis in July, in line with analysts' expectations and the preceding month's readings. Overall, Canada's consumer prices dropped 0.2% month-over-month in the seventh month of the year, compared to the 0.2% hike seen in June, while economic desks expected the indictor to come in at 0.0% in the reported month. Year-over-year, inflation rose 1.3% in July, whereas markets anticipated the inflation rate to remain unchanged at 1.5%. The fall in the overall CPI was mainly driven by lower energy prices, as gasoline prices declined 14% in July from a year earlier, following the previous month's drop of 8.5%. Other data released by Statistics Canada showed a surprise fall in Canada's retail sales. The total value of sales at the retail level in Canada, excluding automobiles dropped 0.8% on a monthly basis in June, compared to May's downwardly revised 0.8% gain. Overall, retail sales decreased 0.1% in the first month of summer, following the preceding month's downwardly revised reading of 0.0%. The volume of sales declined in 7 of 11 categories, accounting for 54% of the industry. Meanwhile, analysts expected Canada's core retail sales and overall retail sales to grow 0.4% and 0.7% in June, respectively.
Upcoming fundamentals: US home sales and manufacturing PMI
In general, Tuesday is another quiet day for the yellow metal. However, a few data releases will occur, which might affect the bullions price, as later in the day US PMI Manufacturing index for August will be released at 13:45 GMT. The index is expected to be a 53.1, which indicates at growth of the sector this month. Moreover, it will be followed by the more important US New Home Sales for July at 14:00 GMT. Analysts forecast that in July 578,000 new home will have been sold. Although that is a decrease of 2.8%, if compared on a monthly basis to June.
Gold threads lower on Tuesday
Daily chart: The yellow metal set a downward course on Friday, and the fall continues into Tuesday, as the metal was moving lower near the level of 1,338.40 by 5:00 GMT. However, the bullion previously had reached the 1,331.76 level, where the first weekly support is located at. The commodity rebounded against the first weekly support and moved back up during Monday's session. However, the before expected rebound ended at the 20-day SMA at 1,340.61 when gold moved lower. During Tuesday's trading session it is expected that the metal will test the resistance put up by the SMA once more.Daily chart
Hourly chart: The hourly chart for Gold on Tuesday is a bit dull, as it shows a straight surge, which has been hindered by incoming resistance. First of all the yellow metal bounced off the weekly S1 at 1,331.76 at 8:00 GMT, when it stopped fluctuating just above the support level. Afterwards, the metal surged past the 20-hour SMA at 1,337.10 by 12:00 GMT. By 16:00 GMT the commodity began to receive pressure from above, as the upper Bollinger band, 55, 100 and 200-hour SMAs from 1,341 to 1,344, as a part of their downward movement, began to close in on the bullion from above. Due to that, gold has been trading flat for the past 12 hours around the level of 1,338.
Hourly chart
SWFX sentiment unchanged on Tuesday
Meanwhile, OANDA Bank clients are bullish with respect to the bullion, precisely in 64.43%. In the meantime, SAXO bank clients are less bullish on the yellow metal, as 57.37% of positions are long.