Gold Price Prediction – Prices Consolidate as the Dollar Rises Following Weak Claims Data
Gold prices continued to consolidate trading sideways again and declining slightly after attempting to move higher. The dollar moved higher which put downward pressure on the yellow metal. US yields moved lower, despite a larger than expected US jobless claims. Gold volatility, which is used to generate option premiums, declined for the 5th consecutive day, which reflects the sideways price action of gold prices.
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Gold prices moved sideways and remain above support is seen near the 10-day moving average at 1,719 Target support is seen near the 50-day moving average at $1,715. Short term momentum has turned negative as the fast stochastic generated a crossover sell. The current reading on the fast stochastic is 74, down from 74. Medium-term momentum if flat as the MACD histogram is printing near the zero-index level with a flat trajectory that points to consolidation. The relative strength index moved sideways as well as printing a reading of 52 which is in the middle of the neutral range and reflects consolidation.
Jobless Claims Rise More than Expected
US jobless claims totaled 1.5 million last week, higher than the 1.3 million expected. The government report’s total was 58,000 lower than the previous week’s 1.56 million, which was revised up by 24,000. Continuing claims, or those who have been receiving unemployment benefits for at least two weeks, nudged lower to 20.5 million, a decline of 62,000 from the previous week. The total of those receiving benefits was 29.1 million as of May 30. That was a decrease of 375,522 from the previous week.