MarketPulse | Sep 23, 2014 08:01AM ET
Gold has been under strong pressure lately but the metal rebounded nicely on Tuesday. In the European session, the spot price stands at $1233.06 per ounce. There are no major US releases today, but the markets will be keeping an eye on the Richmond Manufacturing Index. The indicator is expected to post another strong reading.
US Existing Home Sales didn't impress in August, slipping to 5.05 million, compared to 5.15 million in the previous release. This was way off the estimate of 5.21 million. The indicator had exceeded the estimate in the past three releases, so the weak numbers disappointed the markets. We'll get a look at New Home Sales on Wednesday. Gold took advantage of the weak US numbers and has posted strong gains on Wednesday.
The US economy may be much more robust than that of the Eurozone, but it is also grappling with weak inflation levels. CPI, the primary gauge of consumer inflation, came in at -0.2%, its first drop since October. The estimate stood at +0.1%. Core CPI followed suit with a flat reading of 0.0%. This was the first time the index failed to post a gain since October 2010. The weak numbers follow disappointing manufacturing inflation data. PPI, a key event, dipped to just 0.0%, a 3-month low. The estimate stood at 0.1%. Core PPI slipped to 0.1%, down from 0.2% a month earlier. This matched the forecast. Low inflation levels could delay the Federal Reserve's plan to raise interest rates, which is widely expected to take place in the first half of 2015.
XAU/USD September 23 at 11:20 GMT
XAU/USD 1233.06 H: 1234.31 L: 1214.25
XAU/USD Technical
S3 | S2 | S1 | R1 | R2 | R3 |
1156 | 1186 | 1210 | 1240 | 1252 | 1275 |
Further levels in both directions:
OANDA's Open Positions Ratio
XAU/USD ratio is pointing to gains in long positions on Tuesday, reversing the direction seen a day earlier. This is consistent with the pair's movement, as gold has moved upwards. The ratio has a substantial majority of long positions, indicative of trader bias towards gold continuing to move higher.
XAU/USD Fundamentals
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