Gold slightly lower on the day, holds above $1300 mark
The XAU/USD pair is having a difficult time finding direction on Wednesday and trades in a relatively tight $10 trading range. As of writing, the pair was trading at $1309.10, losing 0.04% on the day.
Despite the greenback strength, the pair's losses are limited in the NA session as the major equity indexes in the U.S. struggle to extend their gains, suggesting that the risk aversion is losing control over the market and making the safe-haven gold more desirable. As of writing, the Dow Jones Industrial Average is losing 3 points while the S&P 500 is slightly higher on the day.
Today's data from the U.S. came in above the market expectations, providing an additional boost to the US Dollar Index. After reaching a fresh session high at 92.80, the index eased back a little and is now at 92.63, gaining 0.4% on the day. According to the Bureau of Economic Analysis, the preliminary reading of the real GDP growth improved to 3% in the second quarter of 2017. Moreover, the ADP employment report revealed a 237,000 increase in private jobs, ramping up the expectations of an upbeat NFP data on Friday.
- US: NFP in focus this week - BBH
Technical outlook
The CCI indicator on the daily graph dropped below the 100 mark on Wednesday, signaling that the bullish momentum is fading away. However, as long as the pair continues to make daily closes above $1300, the pair is likely to make new attempts to extend its earnings. On the downside, $1300 (psychological level) could be seen as the first technical support ahead of $1288 (20-DMA) and $1276 (Aug. 25 low). On the upside, resistances align at $1313 (daily high), $1325 (Aug. 29 high) and $1337 (Nov. 9, 2016, high).
Today's data from the U.S.
- US: Private sector employment increased by 237,000 jobs in August
- US: Real GDP increased at an annual rate of 3.0% in second quarter of 2017