Gold Price Prediction for August 24, 2016

Gold prices consolidated on Tuesday as a stronger than expected New Home Sales report was offset by a softer than expected Richmond Fed manufacturing index report.  Prices were unable to recapture the 10-day moving average at 1,343, while support is seen near the August lows at 1,332.  Momentum is flat with the relative strength index (RSI) printing a reading of 50 which is smack in the middle of the neutral range and reflects consolidation.

The U.S. Richmond Fed manufacturing index dove 21 points to -11 in August, erasing the 20-point jump to 10 in July from -10 in June. This is the lowest reading since January 2013, which allowed the dollar to drop and gold to hold steady. U.S. new home sales jumped 12.4% to 654k in July, following a 1.7% increase in June to 582k. This is the strongest pace since October 2007, and brought the 3-month average to 602.7k from 574.7k