Key Highlights
- Gold price failed to surpass the $1,240 resistance and declined against the US Dollar.
- There was a break below a major bullish trend line with support at $1,224 on the 4-hours chart of XAU/USD.
- The UK ILO Unemployment Rate increased from the last reading of 4.0% to 4.1%.
- Today, the US Consumer Price Index for Oct 2018 will be released, which is forecasted to increase 0.3% (MoM).
Gold Price Technical Analysis
There were many attempts by buyers to push gold price above the $1,240 resistance this month against the US Dollar, but they failed. As a result, the price declined sharply and moved below the $1,220 support.
The 4-hour chart of XAU/USD indicates that the price declined below a few important supports recently such as $1,222, $1,220, $1,212 and $1,208. The price even broke the 50% Fib retracement level of the last wave from the $1,183 low to $1,243 high.
More importantly, there was a close below the $1,212 support and the 100 simple moving average (red, 4-hours). It opened the doors for more losses and the price tested the 76.4% Fib retracement level of the last wave from the $1,183 low to $1,243 high.
Clearly, the price moved into a bearish zone below $1,212 and a major bullish trend line with support at $1,224. If sellers remain in control, the price could slide further towards the $1,188 and 1,185 support levels.
On the flip side, if there is an upside correction, the previous supports at $1,208 and $1,212 are likely to prevent gains and act as hurdles for buyers.
Looking at major pairs, EUR/USD and GBP/USD recovered slightly during the past few sessions, but they both are still trading below important resistances (1.1350 and 1.3040 respectively).
Economic Releases to Watch Today
- German Gross Domestic Product for Q3 2018 (YoY) (Preliminary) – Forecast 1.3%, versus 2.3% previous.
- German Gross Domestic Product for Q3 2018 (QoQ) (Preliminary) – Forecast -0.1%, versus 0.5% previous.
- Euro Zone Gross Domestic Product Q3 2018 (QoQ) (Preliminary) – Forecast 0.2%, versus 0.2% previous.
- Euro Zone Gross Domestic Product Q3 2018 (YoY) (Preliminary) – Forecast 1.7%, versus 1.7% previous.
- UK Consumer Price Index Oct 2018 (YoY) – Forecast +2.0%, versus +1.9% previous.
- UK Core Consumer Price Index Oct 2018 (YoY) – Forecast +2.0%, versus +1.9% previous.
- US Consumer Price Index Oct 2018 (MoM) – Forecast +0.3%, versus +0.1% previous.
- US Consumer Price Index Oct 2018 (YoY) – Forecast +2.5%, versus +2.3% previous.
- US Consumer Price Index Ex Food & Energy March 2018 (YoY) – Forecast +2.2%, versus +2.2% previous.
