Key Highlights
- Gold price is under a lot of pressure and recently broke the $1290 support against the US Dollar.
- There are two bearish trend lines forming with resistance at $1278 and $1286 on the 4-hours chart.
- The US ADP Employment Change in Sep 2017 was 135K, less than the last revised 228K
- Today, the US Initial Jobless Claims figure will be released, which is forecasted to decline from 272K to 265K.
Gold Price Technical Analysis
Gold price started a major downtrend from the $1355 swing high against the US Dollar. The price is now well below $1300 and looks set to extend declines in the near term.
Looking at the 4-hours chart of XAU/USD, there is a clear downtrend visible with resistances near $1290 and $1300. Moreover, there are two bearish trend lines forming with resistance at $1278 and $1286.
An initial resistance is near the first trend line and the 23.6% Fib retracement level of the last decline from the $1313 high to $1268 low. The most important resistance is near the second trend line and the 50% Fib retracement level of the last decline from the $1313 high to $1268 low.
Only a successful close above $1290 could decrease the current bearish pressure on Gold. On the downside, a break of the $1268 low would trigger more losses. The next major support is around $1250 where buyers might take a stand.
US ADP Employment Change
Recently in the US, the Employment Change for Sep 2017 was released by the Automatic Data Processing, Inc. The forecast was lined up for a change of +125K compared with the last 237K.
The actual result was positive, as there was an increase of 135K in jobs in Sep 2017. However, the last reading was revised down from 237K to 228K. There was a 7K decline in job in small businesses and a rise of 63K jobs in medium business.
Commenting on the report, the vice president and co-head of the ADP Research Institute, Ahu Yildirmaz, stated:
In September, small businesses experienced a dip in hiring. This is in part due to Hurricane’s Harvey and Irma which significantly impacted smaller retailers. In addition, the continued slow down we have seen in small business hiring could be due to a lack of competitive compensation to attract skilled talent.
Overall, the result was better than the forecast, putting pressure on Gold price below the $1285 resistance.
