Gold Down At 1,270 after strong US retail sales, Copper Back From 10-Month Highs
A new set of news coming from the Eurozone is underpinning gold as manufacturing PMI in Germany and the euro area showed weak numbers for April, renewing concerns about a possible economic slowdown.
In this framework, gold is trading positive on the day in a dead-cat bounce as experts would say.
Silver is trading in the same range around 15.00 it has been moving in the last sessions; while copper is retreating from 10-month highs reached on Wednesday, and Platinum is performing an exciting technical movement that would open the doors for more gains.
Dollar index is trading higher on Thursday following three sessions of indecision. It jumped to 97.30 to trade at 10-day highs after supporting the 50-day moving average at 96.80 on Wednesday’s session.
The return of the economic concern
Preliminary Markit Manufacturing PMI in Germany showed a 44.5 reading in April, a weaker than the 45.00 expected number by market and a modest improvement from the 44.1 number reported in March.
In the whole euro area, the preliminary manufacturing PMI was reported at 47.8 in April, slightly below the 47.9 expected, but above 47.5 posted in March
PMI composite in the euro area showed a decline to 51.3 in April, from 51.5 in March, a number against the improvement expected to 51.8 expected by the market.
Remember that any number above 50 in PMI means expansion of the industry, while a number below 50 signals contraction.
On the bright side, retail sales in the United States showed strong improvements in March.
Gold consolidates lows above 1,270
Gold is trading positive on Thursday for the first time in six sessions as the metal found support at 1,270, its lowest level since December 27.
According to Michael McCarthy, chief market strategist at CMC Markets, gold is suffering much pressure to the downside coming from the moderation of extreme concerns about the global growth outlook.
“Recent data over the last ten sessions or so have eased concerns, and safe-haven assets have been under significant pressure,” McCarthy said to CNBC.
However, recent economic data in the eurozone has given some life to those concerns and gold is bouncing back.
Currently, XAU/USD is trading at 1,276, 0.18% positive on the day after bouncing back from 1,270 lows and recovering to 1,280.
Technical studies are now suggesting more room for the downside with the 1,250 level as the most significant support. The upside is now contained by the 1,280 level and the 1,310 area.
Silver remains in the range
Silver is trading sideways on Thursday as investors are waiting for a catalyst to move the pair out of the current range.
XAG/USD is now trapped by a small range between 14.90 and 15.05. Technical conditions are not providing hopes for a recovery.
Currently, XAU/USD is trading at 15.00, 0.05% positive on the day.
Copper retreats from 10-month highs
Copper is trading negative on Thursday after getting a rejection from 2.9900 on Wednesday. Its highest price reached since June 27, 2018.
The rejection has been hard, and XCU/USD fell to 2.8980, where a dynamic support coming from March 25 lies. Copper seems now supported by the 50-day moving average at 2.8900.
Currently, XCU/USD is trading at 2.9157, 1.37% negative in the day. Technical studies remain pretty bullish, but the 3.000 area seems too hard to give up easily.
Copper is now inside a triangle between 2.9000, and the 2.9900 levels, any break above or below those levels will be the catalyst for the fate of the commodity.
Platinum interesting technical movement
Platinum is now trading at 888.60, 0.07% negative on the day but the pair seems bullish in the middle term.
XPT/USD just supported on the 877.80 area on Wednesday after retreating from 915.00 on April 8. The movement seems a technical event as the 877.00 level served as strong resistance in the past.
It is now acting as a support. Also, moving averages are pointing to the north. To the upside, immediate price target would be the 910 area.