- 57% of all SWFX open positions are long
- 69% of pending commands were to buy the metal
- The bullion opened at 1,162.16
- Upcoming Events: ADP Non-Farm Employment Change; US Unemployment Claims; ISM Non-Manufacturing PMI
Growth in the US economy's manufacturing sector improved more than expected last month, official figures revealed on Tuesday. The Institute of Supply Management reported its Purchasing Managers' Index advanced to 54.7 in December, surpassing analysts' expectations for 53.7 points. Back in November, the Index climbed to 53.2 from October's 51.9 points. This was the fastest pace of growth seen in five months. Any reading above the 50 point level indicates expansion in the manufacturing sector. Of the 18 manufacturing sectors, 11 reported growth last month, according to Bradley Holcomb, chair of the ISM Manufacturing Survey Business Committee. Other data released on the same day by the Department of Commerce showed that construction spending grew 0.9% to $1.18 trillion in November, the highest point since April 2006, compared to the previous month's upwardly revised gain of 0.6%. In the meantime, economists expected construction spending to rise just 0.5% in the reported month. The November reading together with the October upwardly revised figure could prompt analysts to revise up their overall US economic growth forecasts for the last quarter of 2016.
Americans became more optimistic about the economy in December since the postelection bump in confidence continues. As data suggest the US consumer confidence reached its highest in more than 15 years during the previous week as Americans expect more strength ahead in business conditions, stock prices and the job market following the election of Donald Trump as president in November. According to the Conference Board the Consumer Confidence Index advanced to 113.7 in December from an upwardly revised 109.4 in November. Meanwhile, the data topped estimates in a Reuters poll for a reading of 109.0. Another reason for the gain in confidence is surging optimism among older Americans. Economists follow confidence indicators because upbeat consumers are more likely to increase personal spending, which makes up most of the US economy.
Upcoming fundamental releases: Significant US data
There are various data releases set for Thursday's trading session, which are set to cause volatility in the strength of the US Dollar. Subsequently that will affect the price of the yellow metal. First of all will be the ADP Non-Farm Employment Change at 13:15 GMT. Afterwards, the official US Unemployment Claims will be out at 13:30 GMT. Last but not least, at 15:00 GMT the ISM Non-Manufacturing PMI will be released to the public.
Gold jumps on Thursday
Daily chart: The yellow metal surged at the start of Thursday's trading session, as the commodity price almost reached the 1,180 mark. The day's surge was a continuation of the jump started by the end of Wednesday's trading session. The move higher is caused by weakness in the US Dollar, rather than the strength of the yellow metal. As the bullion will continue to surge, it is set to face resistance at the 1,179.94 level, where the weekly R2 is located at.Daily chart
Hourly chart: The hourly chart for the bullion reveals that the metal has had a steady surge upwards in the past 24 hours. The only exception was a minor stop at the weekly R1, which is located at 1,165.12. Most recently the bullion reached above the 1,179 mark. However it did not make an attempt at the weekly R2 at 1,179.94 and retreated before touching the resistance level.
Hourly chart
SWFX traders still optimistic
OANDA Gold traders remain largely optimistic regarding the Bullion, as open positions were 84.22% long. Meanwhile, traders of SAXO bank have stayed roughly the same in terms of prospects for the metal, as today showed 64.18% of traders betting the metal will surge, compared to 64.83% during the previous session.