Gold Price Prediction – Prices Consolidate Ahead of Employment Report

Gold prices consolidated trading nearly unchanged as the dollar also moved sideways. U.S Treasury yields moved higher which helped buoy the greenback.  It was surprising to see the dollar remain rangebound despite rising U.S. yields as the differential moved in favor of the Greenback. Since gold is priced in U.S. dollars, a stronger U.S. currency makes gold less attractive in other currencies.

Technical analysis

Gold prices consolidate along with the greenback. Resistance is seen near the 50-day moving average at 1,780. Support is seen near the 10-year moving average at 1,752. Short-term momentum is negative as the fast stochastic recently generated a crossover sell signal. Medium-term 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 positive territory with an upward sloping trajectory which points to higher prices.

Jobless Claims Fall

According to the U.S. Labor Department, U.S jobless claims declined to 326,000 for the week ended October 2, below the 345,000 expected and a drop from the previous week’s 364,000. However, the four-week moving average edged higher to 344,000. Continuing claims, which run a week behind and total those who have filed for at least two weeks of benefits, also posted a healthy decline, dropping 97,000 to 2.71 million.