Gold Price Prediction for August 26, 2016

Gold price moved lower on Thursday ahead of Yellen’s speech on Friday and following a stronger than expected Durable goods orders which buoyed the greenback.  Resistance is seen near the 10-day moving average while support is seen near the July lows at 1,309.  Momentum is negative as the MACD (moving average convergence divergence) index recently generated a sell signal.  This occurs as the spread (the 12-day moving average minus the 26-day moving average) crosses below the 9-day moving average of the spread.

U.S. durable goods orders popped 4.4% in July, compared to the 3.6% expected, after dropping 4.2% in June and 2.9% in May. Transportation orders rebounded 10.5% following declines of 11.4% and 7.1% in June and May, respectively. Excluding transportation, orders increased 1.5% from June’s -0.3. Nondefense capital goods orders excluding aircraft rose 1.6% from a 0.5% gain. Nondefense capital goods shipments excluding aircraft dipped 0.4% from -0.5%.