- Gold prices were benefiting on Tuesday following a default in the greenback's impressive bull trend and consecutive days of gains that came to an abrupt end today.
- Gold is currently trading at 1310, below the session highs of $1,312.8/oz2 and up from $1,308.24/oz.
The greenback fell to the 23.6% Fibo retracement of the late Jan rally as the market corrects, despite US yields which remain elevated, with the 10-year yield topping at 2.69% from a low of 2.6490% while U.S. stocks added to the recent gains. News that Sino/U.S. trade talks are making progress and a deal in principle between the U.S. Republican and Democrats over 'the wall', abating fears of another U.S. government shutdown. Nevertheless, gold settled higher on Tuesday, with the April gold contract adding $2.10, or 0.2%, to settle at $1,314/oz.
As for data, analysts at ANZ Bank explained that the US Job Openings (JOLTS) hit a new record high in December, coming in at 7.34m following an upwardly revised 7.17m in November, and indicating ongoing strength in jobs demand and momentum in non-farm payrolls creation:
"All the while, US household debt rose $32bn in Q4 to $13.54tn, exceeding the previous peak of $12.68tn in Q3 2008 and up 21.4% from the post-GFC trough in 2013 Q2. While the US labour market remains strong, the sharp fall in NFIB Small Business Optimism to 101.2 in January (its lowest reading since November 2016 and below market expectations) suggests risks are heightened. That said, a February rebound in small business sentiment could be on the cards given the US government shutdown and late-2018 stock market wobble likely weighed."
Gold levels
Gold has rebounded following a decline that came after the 30th Jan doji was printed, with the decline down to 1308 the low. The price has been held up ahead of the 1,300 psychological level which guards the 1297 9th Jan highs before the 23.6% Fibo retracement down at 1,287 and then critical support area around 1276. Bulls can now target territory towards the rising channel through the 23.6% Fibo of the 23rd Jan lows to recent highs of 1326 at 1314.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.