- 55% of all SWFX open positions are long
- Gold opened Friday's session at 1,255.90
- The 1,250 psychological level is one of the last supports for the metal
- Economic events to watch over the next 24 hours: US Average Hourly Earnings; Non-Farm Employment Change; US Unemployment Rate; FOMC Member Fischer Speaks; FOMC Member Mester Speaks; FOMC Member George Speaks; FOMC Member Brainard Speaks;
The number of Americans filing for unemployment benefits dropped to its lowest level in 43 years, official figures revealed on Thursday. According to the US Department of Labor, initial jobless claims fell 5,000 to a seasonally adjusted 249,000 in the week ending October 1, compared to the preceding week's reading of 254,000, while market analysts anticipated a slight rise to 255,000 in the reported period. It was the 83rd consecutive week of initial claims remaining below the 300,000 level, the longest streak since 1973. Furthermore, the four-moving average of claims, considered a better measure of labor market trends, declined 2,500 to 253,000 last week, the lowest level since December of 1973. The data also showed the number of continuing claims decreased 6,000 to 2.058 million in the week ended September 24, while its four-week moving average declined 21,000 to 2.095 million. Meanwhile, analysts expect Friday's NFP report to announce 171,000 new jobs for September and the unemployment rate to remain unchanged at 4.9%. Immediately after the release of initial jobless claims, the US Dollar rose against other major currencies, trading at 1.1179 against the Euro, 1.2641 against the British Pound and 103.89 against the Japanese Yen, while its Index advanced to 96.44.
US private companies increased their job creation less than expected last month, official data revealed on Wednesday. According to the ADP National Employment Report, non-farm private employment rose 154,000 on a seasonally adjusted basis in September, compared to the preceding month's downwardly revised figure of 175,000, while market analysts expected a slighter drop to 166,000 during the reported period. The ADP report comes out every month two days ahead of the NFP report, which is expected to announce 171,000 new jobs for September, following the previous month's 151,000. Meanwhile, ISM's Manufacturing PMI came in at 57.1, in September, after touching its lowest level of 51.4 points in August, while markets expect the Index to rise to 53.1. Furthermore, factory orders for US goods jumped 0.2%, surpassing the 0.4% fall forecast. The services sector accounts for approximately 80% of the US economy. In the meantime, the EIA data released on Wednesday showed US crude oil inventories dropped 3.0 million barrels last week, declining for the fifth consecutive week. Analysts anticipated a buildup of 1.1 million barrels in the week ending September 30, after the previous week's 1.9 million-barrel fall.
Upcoming fundamentals: US employment and FOMC speakers
The end of the week is coming with a busy schedule, as there are many data releases and five central banking representatives are set to speak. At 12:30 GMT data will be published in the US, as average hourly earnings, non-farm employment change and the US unemployment rate will be released simultaneously. In the second half of the day central bankers will begin giving speeches, as today the IMF Meetings are occurring throughout the day. First will be FOMC Member Fischer at 2:30 GMT. Afterwards FOMC Member Mester at 16:45 GMT, FOMC Member George at 19:00 GMT and FOMC Member Brainard at 20:00 GMT.
Gold marks tenth consecutive session of losses
Daily chart: The yellow metal continued its way down on Thursday, as if there are no support levels, which could affect it. However, that is now almost the truth, as the only significant level of support left is the third monthly support at 1,244.01. The metal's fall has been so drastic, that almost all patterns have been broken and analysts are concentrating more on the fundamentals. However, the 1,250 mark provides a psychological level of significance, and it might stop the drop, as it already did manage to slow it down during Thursday's trading session.Daily chart
Hourly chart: By looking at the hourly chart for gold, it can be noticed that although the major support levels have been passed, the markets have found new levels to look at. First of all, it has to be noted that a chart can be covered with levels of significance in such a way that it would look like a piece of modern art. However, the strength of these levels varies, due to that the weaker lines become relevant in the events, as the most recent drastic fall of the yellow metal. To get to the point, a level of significance is around 1,264, and another one is the psychological 1,250.
Hourly chart
Trader sentiment remains unchanged
Meanwhile, OANDA Bank clients remain majorly bullish with respect to the bullion, as on Friday morning 74.38% of all positions were long. In the meantime, SAXO bank clients show a similar trend with 64.25% of all positions being held by bulls.