- SWFX traders are 56% bullish
- 62% of pending commands are to buy the metal
- The bullion opened at 1,236.45 on Thursday
- Upcoming Events: US Unemployment Claims, FOMC Member's Kaplan's Speech, Treasury Secretary's Mnuchin's Speech
US building permits advanced more than expected whereas homebuilding activity weakened in January, official figures revealed on Thursday. The Commerce Department reported building permits rose 4.6% to a seasonally adjusted annual pace of 1.29 million in January, following the previous month's upwardly revised 1.23 million units and surpassing analysts' expectations for a 1.23 million unit rate. The increase caught markets by surprise, as the figure reached the highest level since November 2015, suggesting solid growth in starts in the middle of 2017.
Meanwhile, housing starts declined 2.6% to an annualized rate of 1.25 million units in the same month, following December's upwardly revised reading of 1.28 million, whereas economists expected them to increase to a 1.23. Analysts suggest that the housing market recovery is likely to be sustained by strong labor market, which supported household formation. Separately, the Philadelphia Federal Reserve said its Manufacturing Index jumped to 43.3 points in February, the highest level in 33 years, driven by a jump in new orders, which climbed to 38.0 from 26.00. Data also showed the Employment Index fell to 11.1 from 12.8, while the Business Outlook Index for the next six months slid to 53.5 points.
Upcoming events: Fiscal and monetary events
Fundamental events in the US today will in the form of speeches from important figures in the US financial market. Firstly, the coming speech of the Treasury Secretary, Mnuchin at 12:00 GMT, will reveal the planned economic policies of the US and therefore it will show the possible shifts that the Trump administration is going to enact during its term. Secondly, the Unemployment Claims release at 13:30 GMT will show the number of new unemployed people in the US. The last but not the least is the speech of FOMC Member Kaplan at 18:00 GMT, which will discuss possible changes in the US monetary policy.
Gold still near 1,235
Daily chart: The yellow metal remains near the 1,235 mark, and near that level the bullion has been fluctuating for the past six consecutive trading sessions. However, the flat trading is consistent with the forecasts, as the bullion continued to be squeezed in a medium term triangle pattern. A breakout to the upside is expected in the upcoming trading sessions, and it is most likely to occur at the start of next week. In such case it is highly likely that the metal's price would reach the 1,250 mark.Daily chart
Hourly chart: According to the hourly chart, the bullion's price has successfully breached the monthly R1, which is located at 1,237.68, but it was consequently stopped by the upper Bollinger Band. During the next few trading sessions it is likely that the price of the yellow metal will continue bouncing between the resistance cluster consisting of the aforementioned monthly R1 and Bollinger Band, and the support cluster consisting of 20, 55,100 SMAs near the 1,235 mark.
Hourly chart
Traders remain bullish
OANDA Gold traders remain bullish on the yellow metal, as open positions grew back to being 63.48% bullish on Wednesday. In the meantime, traders of SAXO bank have diminished their bullish outlook, regarding the yellow metal, as 61.00% of open positions are bullish, compared to 62.12% yesterday.