- Bullish majority increased from 52% to 53% in the past 24 hours
- 1,156 (Aug 24 high) to be targeted next, intermediate resistances placed at 1,147 and 1,151
- Daily technical indicators changed from positive to negative in just two trading days
- Economic events to watch in the next 24 hours: ECB Monetary Policy Meeting Accounts; US Unemployment Claims (Oct 2), FOMC Meeting Minutes; BoE Official Bank Rate, Asset Purchase Facility and Meeting Minutes; BoE Governor Carney Speaks
Among the most recent fundamentals, the number of construction plans in Canada decreased in August, with the unexpected drop in the total value of building permits. As was reported by the Statistics Canada, the number of permits fell for the first time in three months in August, with both residential and non-residential construction intentions declining. At the same time, according to the report, builders in Canada took out C$7.5 billion worth of permits during the given period, down by 3.7% from July. Meanwhile, the prior month's drop of 0.6% was revised to a 0.7% gain. The reading missed market expectations of a 0.3% advance. Vancouver appeared to be a leading city in a decline of permits, as those decreased by 26.1% on a monthly basis in August. However, the city's total value of permits remained 52.3% greater than in the same month a year ago.
Meanwhile, as was broadly expected, the Bank of Japan made the decision to keep its monetary policy unchanged in spite of growing concerns over economy and inflation that is clearly below the bank's target rate of 2%. The Central Bank's Policy Board made up its mind to hold the yearly asset purchases, which is the primary tool for beating deflation and generating inflation, at 80 trillion yen. The BoJ Governor Haruhiko Kuroda stated that the Bank is going to steadily implement its Qualitative and Quantitative Easing programmes, in order to reach the inflation target of 2% as soon as possible.
Upcoming fundamentals: Bank of England to vote on interest rates today
Along with meeting minutes from the European Central Bank and the Federal Reserve, the Bank of England will also release a report about the MPC committee's meeting today. Prior to that, the UK monetary regulator will make decisions on interest rates and volume of the QE programme by 11:00 GMT. The most interesting part of the data release will be distribution of votes on interest rates between MPC members. Analysts foresee no change today, with only one member still projected to vote in favour of raising the benchmark rate by 25 basis points. In the meantime, the BoE Governor Mark carney will speak today at the IMF Conference in Lima, Peru.
Gold trades range bound above 100-day SMA
On Tuesday and Wednesday the bullion repeated development seen on Friday and Monday, respectively. Following a strong advance two days ago, gold remained broadly unchanged in the past 24 hours. It seems that narrow trading boundaries are being built by the monthly R1 at 1,147 and 100-day SMA, currently at 1,142. A failure at the latter level would expose a strong demand zone at 1,130/32. From the other side of the coin, only a spike above 1,155 (Aug 24 high/weekly R1) can affirm any of bullish intentions among market participants.Daily chart
Even though the price has mostly stagnated during the previous trading session, it is still hovering well above the 200-hour SMA, which is presently accompanied by the 2014 low and 38.2% Fibonacci retracement of the May-July 2015 downtrend. This state of affairs supports the positive case for the foreseeable future.
Hourly chart
SWFX bullish share is back to 53%
Mentioning sentiment of other market players, OANDA's bullish share declined further from circa 57% to around 55.50% by Thursday morning. Alongside, SAXO Bank long traders lost one additional percentage point yesterday, down from 61% to 60%.