- SWFX traders are 54% bullish
- 61% of pending commands are to buy the metal
- The bullion opened at 1,237.03
- Upcoming Events: FOMC Member's Kashkari's Speech; FOMC Member's Harker'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: FOMC speakers
The speeches of US monetary policy makers, which are set to dictate the financial markets during this week, will begin on Tuesday. First of all at 13:50 GMT FOMC member Kashkari is set to give a speech. Afterwards, at 17:00 GMT, FOMC Member Harker is scheduled to speak. These will be the first two monetary policy speeches out of five that are scheduled for this week.
Gold declines on Tuesday
Daily chart: The yellow metal lost value during the early hours of Tuesday's trading session, as the bullion was in a retreat after failing to break the resistance put up by the monthly R1 at 1,237.68 during Monday's trading session. However, if compared with previous price levels, the commodity price has not changed much for the past four trading sessions. The reason for that is that market participants are expecting clues regarding US monetary policy. In the meantime, from a technical perspective the yellow metal is set to remain flat until it encounters the uptrend line in the next two trading sessions.Daily chart
Hourly chart: The hourly chart reveals that the range between the weekly PP at 1,231.36 and the monthly R1 at 1,237.68 is covered by all of the hourly simple moving averages. The SMAs are passing the commodity price around one from another. That is the reason, why the yellow metal is not making sharp falls and climbs between the before mentioned levels of significance.
Hourly chart
Trader opinion unchanged
OANDA Gold traders have not changed their bullish outlook on the yellow metal, as open positions were 63% bullish on Tuesday, compared to 63% previously. In addition, traders of SAXO bank have done the same, regarding the yellow metal, as 60.32% of open positions are bullish, compared to 60.27% yesterday.