Gold Price Prediction – Prices Slip Despite a Dollar Decline

Gold prices pulled back after rallying for most of the week. The move-in gold came despite a decline in the greenback, which is still up for the week. On the heels of Wednesday’s Fed Minutes and Thursday’s jobless claims data, U.S. Yields continued to move lower. The decline in the U.S. 10-year yield eased slightly but the robust downtrend in the ten year yields remains downward sloping.

Technical analysis

Gold prices moved lower and continue to consolidate above support seen near the 10-day moving average near 1,784. Resistance is seen near the 50-day moving average at 1,835.   Short-term momentum has flip-flopped turning negative after turning positive on Wednesday as the fast stochastic generated a crossover sell signal. Medium-term momentum has shifted positively 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 Rise More than Expected

According to the Labor Department, jobless claims unexpectedly rose last week. This scenario could mean that employment has reached a temporary peak, which was somewhat reflected in this week’s JOLTS report. First-time jobless claims totaled 373,000 for the week ended July 3, compared with the 350,000 expected. The previous week’s level was revised up by 7,000 from 364,000 to 371,000.