Key Highlights
- Gold price after trading towards $1275 found resistance and declined sharply against the US Dollar.
- There are two important bullish trend lines forming with supports at $1258 and $1255 on the 4-hours chart of XAU/USD.
- Today, the Caixin China Services PMI for July 2017 was released, which posted a minor decline from 51.6 to 51.5.
- The US Services PMI will be released today for July 2017, which is slated to remain at 54.2.
Gold Price Technical Analysis
Gold price is in a solid uptrend and trading comfortably above $1250 against the US Dollar. The price after trading as high as $1274 started a correction and currently testing a major support.
It has already moved below the 23.6% Fib retracement level of the last wave from the $1243.77 low to $1274.15 high. However, the downside move was protected by the $1255 support.
There are two important bullish trend lines forming with supports at $1258 and $1255 on the 4-hours chart of XAU/USD. Moreover, the 50% Fib retracement level of the last wave from the $1243.77 low to $1274.15 high is at $1258.
All these are important supports near $1255-60. As long as these are intact, there are chances of Gold resuming its uptrend back towards $1270 in the near term.
Caixin China Services PMI
Today, the Caixin China Services PMI for July 2017 was released. The market was looking for an increase in the PMI from the last reading of 51.6 to 51.9.
However, the actual result was opposite, as there was a minor decline from 51.6 to 51.5. On the other hand, the Composite Output Index posted a decent rise from June’s low of 51.1 to 51.9 in July 2017, which is a new four-month high.
The report added that:
New business also expanded at a weaker pace across the service sector in July. Furthermore, the rate of growth edged down to the least marked for 16 months, with some panellists linking relatively subdued sales to lower client numbers.
Overall, the result was positive, and helped Gold to remain above the $1255-60 support area.
Today’s Economic Releases during NY Session
- US Services PMI for July 2017 – Forecast 54.2, versus 54.2 previous.
- US ISM Non-Manufacturing Index for July 2017 – Forecast 57.0, versus 57.4 previous.
- US Initial Jobless Claims – Forecast 242K, versus 244K previous.
- US Factory Orders June 2017 (MoM) – Forecast +2.8%, versus -0.8% previous.
