- 53% of all SWFX open positions are long
- The yellow metal's price was dictated by US politics
- In the aftermath of Donald Trump's victory in the US presidential election gold fell after an initial spike
- Economic events to watch over the next 24 hours: US Building Permits; US CPI; US Core CPI; US Philly Fed Manufacturing Index; US Unemployment Claims; US Housing Starts; FOMC Member Dudley Speaks; Fed Chair Yellen Testifies, FOMC Member Brainard Speaks
US industrial production remained unchanged unexpectedly last month, amid the weak heating demand. According to the Federal Reserve, the country's industrial output was flat on a seasonally adjusted basis in October, following the preceding month's downwardly revised fall of 0.2%. However, market analysts anticipated a slight increase of 0.2% in the reported month. Utilities production declined 2.6% last month, after dropping 3.0% in September. The Fed said milder weather than normal reduced the demand for heating during October, offsetting gains of 0.2% and 2.1% in the manufacturing and mining categories, respectively. Data also showed that capacity utilization fell 0.1% to 75.3%. Separately, the US Department of Labor said its Producer Price Index came in at 0.0% in October, whereas economists expected the Index to advance 0.3% as in the prior month. Nevertheless, on an annual basis, the PPI rose 0.8%, the largest increase since December 2014, compared to September's gain of 0.7%. In the meantime, the Energy Information Administration reported on Wednesday that US crude oil inventories increased to a seasonally adjusted rate of 5.3 million barrels in the week ended November 11, following the previous week's rise of 2.4 million barrels.
US retail sales posted a better than expected increase last month, suggesting economic strength and increasing chances for a December interest rate hike. The US Department of Commerce said on Tuesday retail sales climbed 0.8% on a monthly basis in October, following September's upwardly revised gain of 0.5% and surpassing the 0.5% increase forecast. Year-over-year, retail sales grew 4.3% last month. Excluding volatile items such as motor vehicles and parts, retail sales advanced 0.8% in October, whereas economists expected them to increase just 0.5%. Meanwhile, the preceding month's reading was revised up to 0.7% from the originally reported rise of 0.5%. The October stronger than expected retail sales supported the view that the Federal Reserve will raise interest rates at its next policy meeting on December 13-14. The last time the Fed increased its key rate was December 2015, and kept its steady since then because of low inflation rates. Back in the Q3, the US economy expanded at an annual rate of 2.9% and it is set to grow 3.1% in the Q4, according to the latest economic growth forecasts released by the Atlanta Fed. As a result, the US Dollar jumped markedly against the Euro, with the EUR/USD pair declining to $1.0733 from $1.0759 ahead of the release.
Upcoming fundamentals: Loads of data and events
Data, which will affect the strength of the US Dollar, is set to be released in the second half of the day. Most of it will be out at 13:30 GMT, when US Building Permits, CPI, Philly Fed Manufacturing and Unemployment Claims, and Housing Starts will be published. Later on in the day most likely even more important events will occur. At 13:50 GMT FOMC Member Dudley gives a speech. At 15:00 GMT is the event of the day, as Chairwoman of the Fed, Janet Yellen, is testifying about the economic outlook before the Joint Economic Committee. Afterwards, at 17:30 GMT FOMC Member Brainard is set to give a speech.
Gold remains flat
Daily chart: The title explains it almost fully, as the yellow metal remained near 1,225 levels on Thursday morning. However, it has to be noted that it is somewhat strange that the bullion has not continued to fall during this week, as the opposite of, what occurs in the metal's situation, has been occurring across the markets. Risk on sentiment is back on, as investors retreat from the safe investments, which were bought pre-election. Market participants will most likely continue to wait for additional information, which will affect the bullion's price.Daily chart
Hourly chart: The hourly chart reveals that the volatility, which still existed on Wednesday morning and seemed to move the yellow metal upwards, is gone. The bullion keeps trading in limbo around the 20 and 55-hour SMAs, which are both located at the same spot. However, the 100-hour SMA is incoming from the upside at 1,228, which meant that it might propel the bullion down. Although, that was what the 55-hour SMA was supposed to do also.
Hourly chart
Traders slightly reconsider their positions
OANDA open long positions have slightly increased and are at 78.21%, compared to 77.17% on Wednesday. SAXO bank traders remain long, as 69.81% of traders were long on Thursday morning, compared to 64.95% during the previous session.