The gold market is holding on to strong gains for the third straight session even as fewer American workers apply for first time weekly unemployment benefits.
Thursday the U.S. Labor Department said that weekly jobless claims fell by 75,000 to 712,000, down from the previous week’s revised estimate of 787,000 claims.
The latest labor market data beat economists’ estimates as consensus forecasts called for initial claims to be round 775,000.
The gold market is seeing little reaction to the latest economic report as it continues to see strong technical buying after November’s dismal performance. February gold futures last traded at $1,841.50 an ounce, up 0.62% on the day.
After bouncing off critical support below $1,800, gold prices have rallied 3.5% in the first three days of December.
The four-week moving average for new claims – often viewed as a more reliable measure of the labor market since it flattens week-to-week volatility – fell to 739,500, down by 11,250 claims from the previous week.
Continuing jobless claims, which represent the number of people already receiving benefits, were at 5.52 million during the week ending Nov. 21, down by 569,000 from the previous week.
According to some economists, markets are taking the latest labor market data with a grain of salt as they wait for Friday’s nonfarm payrolls report for October. According to consensus forecasts, economists are expecting that 500,000 jobs were created in November.
However, downside risks for the labor market are growing after private payrolls processing company ADP reported, Wednesday, weaker than expected job growth last month.
ADP said that 307,000 jobs were created, well below consensus forecasts calling for gains of around 433,000 jobs.
Overall, the bias in prices is: Downwards.
By the way, prices are vulnerable to a correction towards 1,866.18.
The projected upper bound is: 1,903.21.
The projected lower bound is: 1,773.86.
The projected closing price is: 1,838.54.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 95.8269. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 3 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 46.68. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 3 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 20. This is not a topping or bottoming area. The last signal was a buy 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 0 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed down -1.400 at 1,838.960. Volume was 8,900% above average (trending) and Bollinger Bands were 1% narrower than normal.
Open High Low Close Volume 1,840.660 1,842.460 1,837.500 1,838.960 4,671
Technical Outlook Short Term: Neutral Intermediate Term: Bearish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 1,814.96 1,879.16 1,803.64 Volatility: 22 22 24 Volume: 467 93 23
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
PREC.M.XAU= is currently 2.0% above its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods.
Our volume indicators reflect very strong flows of volume into XAU= (bullish). Our trend forecasting oscillators are currently bearish on XAU= and have had this outlook for the last 13 periods.