Gold prices moved lower on Thursday while the dollar remained steady and US yields consolidated. This comes as the US Labor Department reported a slightly larger than expected increase in jobless claims. Also on the economic docket the US reported a larger than expected decline in April existing home sales.
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Technical analysis
Gold prices moved lower, unable to break out to new highs, after hitting a fresh 7.5-year high on Wednesday. The dollar edged slightly higher generating headwinds for the yellow metal. Prices seemed to hold support near the 10-day moving average at $1723. Resistance is seen near the May highs at $1,765. Short-term momentum has turned negative as the fast stochastic recently generated a crossover sell signal in overbought territory. Medium-term momentum has also turned negative as the MACD (moving average convergence divergence) index recently generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line).
Jobless Claims Rise
New Jobless Claims in the US totaled 2.44 million last week according to the labor department. Expectations were for a rise of 2.4 million. Last week’s numbers were revised lower from 2.98 million to 2.69 million. In the nine weeks since the coronavirus-induced lockdown has closed large parts of the U.S. economy, some 38.6 million workers have filed claims.
