- 51% of all SWFX open positions are short
- Gold reached a rising wedge pattern's lower trend line on Thursday
- Economic events to watch over the next 24 hours: US NAHB Housing Market Index;
Consumer prices in the United States rose more than expected last month, official data revealed on Friday. According to the US Bureau of Labor Statistics, the overall Consumer Price Index (CPI) jumped 0.2% month-over-month in August, compared to the preceding month's reading of 0.0%, while market analysts anticipated a slighter acceleration to 0.1% during the reported month. On an annual basis, the CPI increased 1.1%, up from July's 0.8%. The socalled core CPI that excludes goods with high price volatility, such as food and energy, advanced 0.3% on a monthly basis in August after rising 0.1% in July, whereas economic desks expected the core inflation to grow 0.2% last month. On a yearly basis, the indicator climbed 2.3% during the reported period, slightly up from July's 2.2% reading. The modest rise in inflation last month is likely to be welcomed by the Federal Reserve at its meeting next Tuesday and Wednesday. However, it is widely expected to leave interest rates on hold amid weak retail sales, industrial production and job growth. Within the headline CPI basket, the price of gasoline dropped 0.9% last month, compared to July's 4.7% fall. Food prices were unchanged, whereas the cost of food consumed at home decreased for the 4th consecutive month.
According to the Labor Department, the number of Americans filing for unemployment aid rose to a seasonally adjusted 260,000 in the week ended September 10, slightly up from the preceding week's 259,000 claims, while market analysts anticipated an increase to 262,000 during the reported week. It was the 80th consecutive week initial jobless claims remained below the 300,000 level, the longest streak since 1973. The four-moving average of claims, considered a better measure of labor market trends, fell 500 to 260,750 during the same week. Separate data released by the Labor Department revealed that the PPI came in at 0.0% in August, up from July's decline of 0.4%. However, markets expected the Index to increase 0.3%. The so-called core PPI advanced 0.1% last month, also up from July's 0.3% fall and in line with economists' projections. Other Thursday's data showed that US retail sales declined 0.3% monthover-month in August, compared to July upwardly revised 0.1% rise, whereas economic desks penciled in a slight drop of 0.1% in the reported month. Excluding automobiles, gasoline, building materials and food services, retail sales slipped 0.1% last month, following the previous month downwardly revised fall of 0.4% and falling behind the 0.3% growth forecast.
Upcoming fundamentals: All quiet on Monday
It is one of the quiet Mondays, as almost no fundamental data releases will affect the US Dollar's strength, which in turn might affect the yellow metal's move. However, it is possible that a slight fluctuations might occur during the US NAHB Housing Market Index release. Although, the US housing data at 14:00 GMT is more likely to give a look into the US economy and its general state.
Gold remains near support line on Monday
Daily chart: The yellow metal was struggling with the resistance put up by the newly formed weekly PP at 1,316.02. Previously, on Friday the bullion fell below the resistance put up by the rising wedge pattern's lower trend line at 1,312.88. However, as it was closing in on the 100-day SMA and the lower Bollinger band, the metal changed its direction and began a surge, which continued on Monday morning, as the XAU/USD rate approached the previously mentioned pivot point.Daily chart
Hourly chart: The hourly chart for gold reveals not much new information. The fall of the rate until 18:00 GMT on Friday was gradual and without major fluctuations, as even the US fundamental data releases did not shuffle the bullion. Moreover, the surge, which began at 18:00 remained active until 6:00 GMT on Monday, as the rate began to reach above the weekly PP at 1,316.02.
Hourly chart
Traders still expect a surge
Meanwhile, OANDA Bank clients are largely bullish with respect to the bullion, precisely in 75.68%. In the meantime, SAXO bank clients are also bullish on the yellow metal, as 65.97% of positions are long.