News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • How does stock market liquidity benefit its traders? Learn more here: https://t.co/FWKyIDUwAw https://t.co/tyoYrsh8mQ
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/4078fnQJON
  • Looking for a new way to trade reversals? One of the most used reversal candle patterns is known as the Harami. Like most candlestick formation patterns, the Harami tells a story about sentiment in the market. Get better with trading reversals here: https://t.co/kIIBffEMi7 https://t.co/tt59BU8lnS
  • Quarterly earnings from Netflix and Tesla, two big tech companies, will take center stage next week and could set the trading tone for the S&P 500 and the Nasdaq 100. Get your weekly equities forecast from @DColmanFX here: https://t.co/NOCqjJ3TLd https://t.co/HR5xUZeJXp
  • Do you know the difference between investing and trading? Because while the goal might seem the same, they're very different things . Learn more here.https://t.co/fG6fNEPj9q https://t.co/ymGaYjrl1g
  • What is your forex trading style? Take the quiz and find out: https://t.co/YY3ePTpzSI https://t.co/FOMcsxci50
  • Further your trading knowledge and gain informed market analyses from our expert analyst @DavidJSong on Oil with our free Q4 guide, available for free today.https://t.co/Y6XECmr5fQ https://t.co/XQI3PN4bkQ
  • Nasdaq 100 may hit new high soon. https://t.co/ACtVqiOBl0
  • HSTECH index has likely formed an "Inverse Head & Shoulders" pattern. https://t.co/YFIQEYmuyq
  • The HSI has likely formed a “Double Bottom” chart pattern, which is usually viewed as bullish-biased. https://t.co/wMQ14A867Q
Gold Price Outlook Turns to UofM Sentiment as US Dollar, Treasury Yields Rally

Gold Price Outlook Turns to UofM Sentiment as US Dollar, Treasury Yields Rally

Daniel Dubrovsky, Strategist

Gold, XAU/USD, US Retail Sales, University of Michigan Sentiment, IGCS, Technical Analysis - Talking Points:

  • Gold prices extended losses after US retail sales beat expectations
  • Rosy University of Michigan Sentiment data could extend its losses
  • Bearish Rising Wedge breakout continues to unfold, eyes on SMAs

Anti-fiat gold prices weakened during Thursday’s North American trading session, extending the near-term downtrend since the beginning of this month. XAU/USD was likely pressured by a combination of a stronger US Dollar and rising longer-term Treasury yields. The 10-year rate closed at its highest since the beginning of this week.

Stronger-than-expected US retail sales data was likely the key culprit, rising 0.7% m/m in August versus -0.7% anticipated. Excluding automotive and gas sales, transactions increased 2.0% versus 0.0% anticipated. The data likely continued fueling the Fed tapering timeline debate after mixed US jobs and CPI data. This comes ahead of next week’s FOMC monetary policy announcement.

Over the remaining 24 hours, gold traders ought to keep an eye out for University of Michigan Sentiment data. Preliminary estimates for September point to a 72.0 outcome, which would be higher than the 70.3 result in August. Another rosy print could further push of bond yields and the US Dollar, placing the yellow metal at risk. Likewise, a softer result may offer some cushion to XAU/USD.

Check out the DailyFX Economic Calendar for more key events!

Gold Technical Analysis

Gold continues to trade lower in the aftermath of breaking under a bearish Rising Wedge chart formation. On the 4-hour chart below, the 50-period Simple Moving Average crossed under the 100 equivalent. That created a bearish ‘Death Cross’, underscoring the technical bias to the downside. Key support seems to be 1740, which is the August 12th low. In the event of a turn higher, the 1769 inflection point may act as resistance.

XAU/USD Daily Chart

Gold Price Outlook Turns to UofM Sentiment as US Dollar, Treasury Yields Rally

Chart Created Using TradingView

Gold Sentiment Analysis

According to IG Client Sentiment (IGCS), about 85% of retail investors are net-long gold. Upside exposure increased by 16.25% and 13.77% over a daily and weekly basis respectively. We typically take a contrarian view to crowd sentiment. Since most traders are net-long, it suggests prices may continue falling. Recent changes in positioning are further underscoring a bearish contrarian trading bias.

Gold Price Outlook Turns to UofM Sentiment as US Dollar, Treasury Yields Rally

*IGCS chart used from September 17th report

--- Written by Daniel Dubrovsky, Strategist for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES