- 51% of all SWFX open positions are long
- 57% of pending commands are to buy the metal
- The bullion opened at 1,200.29
- Upcoming Events: US Unemployment Claims; US New Homes Sales
US homebuilding activity advanced more than expected in the last month of 2016, official figures revealed on Thursday. The Commerce Department reported housing starts rose 11.3% to a seasonally adjusted annual pace of 1.23 million in December, following the previous month's upwardly revised 1.10 million units and surpassing analysts' expectations for a 1.19 million-unit rate. The December increase suggested the housing market boosted economic growth in the Q4. Meanwhile, building permits came in at a seasonally adjusted annual pace of 1.21 million units in the same month, unchanged from November's upwardly revised reading, slightly missing economists' projections of a 1.22 million-unit rate.
Separately, the Philadelphia Federal Reserve said its Manufacturing Index jumped to 23.6 points in January, the highest level in more than two years, driven by a rise in new orders, which climbed to 26.0 from 14.90. Analysts anticipated a sharp fall to 16.2 points in January from the prior month's 21.5. Data also showed the Employment Index surged to 12.8 from 3.6, while the Business Outlook Index for the next six months hit its highest level since August 2014 of 56.6 points. Other data released on Thursday showed initial jobless claims fell 15,000 to 234,000 last week, the lowest level in more than 43 years.
Upcoming fundamental events: Unemployment and housing
Data, which might affect the strength of the US Dollar and subsequently the price of the yellow metal is set to be released in the US at two different times. At 13:30 GMT US Unemployment Claims are set to be published. Afterwards, at 15:00 GMT the US New Home Sales data will be released. Traders should look more at the Unemployment Claims, rather the housing data.
Gold fluctuates near support level
Daily chart: The yellow metal traded near the weekly S1, which is located at 1,197.37. As forecasted, the bullion fell to the level during Wednesday's trading session. However, it also managed to pass it and touch the 1,193.44 mark during the session. On Thursday morning it is clear that the metal is most likely to continue its fall up to the 1,191.40 level, where the 20-day SMA is located at. If that support level is passed, the bullion might fall as low as the 1,185 mark, where a cluster of support begins. However, it is also possible that the metal rebounds and heads higher. Due to that traders are advised to observe and wait for the start of the move.Daily chart
Hourly chart: The hourly chart reveals that the bullions fall is being hindered by the lower Bollinger band of the hourly chart. The rate has more than once fall below the weekly S1, which indicates at the fact that this level of significance is not strong enough to keep the commodity price from falling. In addition, the previously discovered downwards aimed channel is still in force.
Hourly chart
SWFX sentiment unchanged
OANDA Gold traders have consistently continued to decrease their bullish outlook on the yellow metal, as open positions were already 66% bullish on Thursday, compared to 80% a few weeks ago. Meanwhile, traders of SAXO bank also remain long, regarding the yellow metal, as 67.55% of open positions are bullish.