Gold Price Prediction – Gold Rises on Week Durable Goods Orders

Gold prices moved higher on Wednesday ahead of the US Thanksgiving Holiday, as the dollar eased, and US rates moved lower. A softer than expected durable goods order report combined with a 4-month high in jobless claims, took some of the hawkish tone out of the interest rate market putting upward pressure on the yellow metal.

Technical Anaylsis

Gold prices moved higher recapturing the 20-day moving average which is now seen as short-term support near 1,221. Prices are poised to test target resistance near the October highs at 1,243.  Additional support is seen near the 50-day moving average at 1,210. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices.

Durable Goods Order Sink More than Expected

U.S. factory orders that are expected to last more than 3-year fell the most in 15 months with a key category that tracks business investment showing weakness for a third straight month. According to the Commerce Department orders for durable goods dropped 4.4% last month. It was the third decline in the past four months with the October drop led by a huge decline in the volatile areas of commercial and military aircraft. Business investment was flat in October after declines in both August and September.

Jobless Claims Rise to a 4-Month High

Employment is starting to ease according to initially unemployment claims. US weekly jobless claims rise to a more than 4-month high. Initial claims for state unemployment benefits increased 3,000 to a 224,000 for the week ended Nov. 17, the highest level since the end of June, the Labor Department said.