Gold Price Prediction for May 17, 2017

Gold prices edged higher on Tuesday as the yellow metal benefited from a weaker dollar.  A softer than expected housing starts report, on the heels of Friday’s weaker than expected retail sales report, has generated headwinds for the greenback, paving the way for higher gold prices.  Gold recaptured resistance which is now support near the 10-day moving average at 1,228.  Resistance is seen near an upward sloping trend line near 1,255.  Momentum is neutral as the MACD (moving average convergence divergence) index histogram is edging higher reflecting decelerating negative momentum.

U.S. Housing Starts Unexpectedly Declined

U.S. housing starts fell 2.6% to 1.172 million in April, weaker than expected, after a 6.6% March drop to 1.203 million which was revised down from 1.215 million. It’s the slowest pace of starts since November. The volatile multifamily sector paced the weakness, dropping 9.2% from -9.7% which was revised from -7.9%.