- 52% of all SWFX open positions are short
- Gold recently found support and surged
- Economic events to watch over the next 24 hours: US Retail Sales; US Philly Fed Manufacturing Index; US Unemployment Claims; US Current Account; US Empire State Manufacturing Index; US Capacity Utilization Rate; US Industrial Production;
US import prices dropped unexpectedly last month amid lower petroleum and food prices, official data revealed on Wednesday. According to the Department of Labor, import prices fell 0.2% on a monthly basis in August, compared to the preceding month's unrevised gain of 0.1%, whereas market analysts penciled in a decline of 0.1% in the reported month. Moreover, that was the first monthly fall since February. Lower oil prices as well as the strong US dollar put downward pressure on the price of imports last month. August's decline in import prices was led by a monthly fall in the cost of imported communications equipment, which dropped 1.0%. On the positive side, the price of imports from Japan jumped 0.3% in the reported month, posting the largest increase since August 2011. The cost of imported petroleum fell 2.8% in August, following the previous month's decrease of 3.6%. Excluding petroleum, import prices remained unchanged after rising 0.5% in July. Other data released by the US Energy Information Administration on the same day showed that crude oil inventories fell 0.6 million barrels in the week ended September 9, following the 14.5 million barrel drop seen in the previous seven days and surpassing the 2.8 million barrel gain forecast.
On Thursday September 8, the European Central Bank decided to leave interest rates in the single currency area unchanged, but being open for more cuts in the upcoming months and renewed calls to politicians to apply more stimulus for the economic recovery. As a result, the ECB held the single currency area's main interest rate at zero. Also, the European Central Bank left its 1.7 trillion euro stimulus programme unchanged, brushing off concerns over economic shock waves from Britain's decision to leave the European Union. However, the ECB president Mario Draghi noted that uncertainty over the Brexit was among the factors dampening the Euro zone's growth and he unveiled a slightly weaker economic outlook for the bloc. Although, the ECB did not even discuss extending its 80 billion (per month) asset purchase programme, as president Mario Draghi noted "not so substantial to warrant a decision to act". The ECB President Mario Draghi also stayed that he is concerned over persistently low Euro zone inflation, which has fallen short of the ECB's near-2% target for more than three years. According to the fresh ECB staff forecasts, inflation rising very gradually, to 1.2% next year and 1.6% in 2018.
Upcoming fundamentals: Various US data
Data from the US will begin pouring in at 12:30 GMT, as various indicators and data are set to be released. At that time the US Retail Sales and PPI data for August will be released. In addition, simultaneously the Philly Fed Manufacturing and Empire State Manufacturing Index will be published. Moreover, US Unemployment Claims together with the Current Account of the country will be out at the same time. If that will not satisfy the hunger of the market for information, US Capacity Utilization Rate and Industrial Production will be released at 13:15 GMT. .
XAU/USD tests resistance at 1,326.43
Daily chart: The yellow metal tested the resistance of the monthly PP at 1,326.43 once more on Thursday morning. However, the bullion did not manage to break the resistance, as on Thursday morning it was even stronger than on Wednesday, as the 20-day SMA at 1,327.91 strengthened the pivot point. The almost unchanged market sentiment and daily aggregate technical indicators forecast that the metal will continue to fluctuate around the 1,320 level during the day, and the price will remain unchanged by the end of today's trading session.Daily chart
Hourly chart: On the hourly chart for gold it can be seen that the yellow metal simply surged in the past 24 hours until it reached the upper Bollinger band just below the monthly PP at 1,324.91 by 2:00 GMT. There the bullion changed direction and has slightly fallen, as it trades just above the lower Bollinger band at 1.321. However, the distance between the bands is only four US Dollar wide, as volatility has disappeared in the past 20 periods used of the calculations.
Hourly chart
Traders expect a surge
Meanwhile, OANDA Bank clients are largely bullish with respect to the bullion, precisely in 68.00%. In the meantime, SAXO bank clients are also bullish on the yellow metal, as 63.69% of positions are long.