Gold has posted gains in the Thursday session. In North American trade, the spot price for one ounce of gold is $1311.04, up 0.34% on the day. In economic news,there was just one key event. Unemployment claims dropped to 234 thousand, but this was above the estimate of 220 thousand.
The Federal Reserve does not hold its policy meeting until mid-March, so investors will be left to focus on remarks from Fed Chair Jerome Powell and his colleagues. The Fed raised interest rates four times last year, but economic conditions are very different in 2019. The U.S-China trade war has dampened global growth and rocked the equity markets. With the U.S. unlikely to replicate the sparkling growth we saw in 2018, the Fed is projecting just two rate increases. The markets, however, are predicting no rate moves, and some analysts are even talking about the possibility of a rate cut late in 2019.
President Trump’s State of the Union address was a yawner as far as the markets were concerned, but there were some points of interests for investors. Trump spoke about the U.S-China trade war, reiterating that the U.S. would demand “real structural change” from China before a trade deal could be reached. American policymakers have long demanded that China desist from intellectual theft against U.S. companies, and with China experiencing a slowdown, the Chinese may have to make concessions or face further tariffs in March. A third round of negotiations between the sides is scheduled for this month, raising hopes that the U.S. will not impose further tariffs on China in early March. Trump also announced that he will meet North Korean leader Kim in late February, an event which could bolster risk appetite and weigh on gold prices.
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Thursday (February 7)
- 8:30 US Unemployment Claims. Estimate 220K. Actual 234K
- 9:30 US FOMC Member Clarida Speaks
- 10:30 US Natural Gas Storage. Estimate -228B
- 13:01 US 30-year Bond Auction
- 15:00 US Consumer Credit. Estimate 16.5B
- 19:30 US FOMC Member Bullard Speaks
*All release times are EST
*Key events are in bold
XAU/USD for Thursday, February 7, 2019
XAU/USD February 7 at 12:30 EST
Open: 1306.51 High: 1311.96 Low: 1302.89 Close: 1311.04
XAU/USD showed limited movement in the Asian session. The pair posted small losses in the European session and is steady in North American trade
- 1306 is providing support
- 1326 is the next resistance line
- Current range: 1306 to 1326
Further levels in both directions:
- Below: 1306, 1284, 1261 and 1236
- Above: 1326, 1344 and 1365
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