Gold dips as core retail sales sparkle

Gold has started the week with losses. In Monday’s North American trade, the spot price for one ounce of gold is $1292.74, down 0.47% on the day. In economic news, retail sales rebounded in February. Core retail sales sparkled with a 0.9% gain, up from -1.8% in January. Retail sales improved to 0.2%, compared to -1.2% in the previous release. Both indicators beat their estimates. On Tuesday, the U.S. releases CPI numbers.

Gold prices tend to move higher on geopolitical tensions, and the British parliament will be one such hotspot this week. On Tuesday, lawmakers will vote for a second time on the government’s withdrawal agreement on March 12. With no signs that this proposal will be different than the one which was shot down in parliament in January, the vote could turn into a major embarrassment for the May government. If this latest proposal is rejected, parliament will vote the next day on two separate proposals – one on a no-deal Brexit, and the second on requesting the EU to extend Article 50 and delay Brexit past March 29. The parliamentary vote(s) will provide plenty of Brexit drama and could trigger volatility in gold prices.

In the U.S., there was a surprisingly low reading from the February nonfarm payrolls. The indicator showed that the U.S. economy eked out just 20 thousand jobs, much worse than the forecast of 180 thousand. On a brighter note, wage growth improved to 0.4%, above the estimate of 0.3%. Despite the weak NFP report, the pound could not take advantage and posted losses on Friday, capping a week in which GBP/USD dropped 1.4%.

Trade trembles and Brexit bumbling start the week

Brexit and sterling volatility expected

XAU/USD Fundamentals

Monday (March 11)

  • 0:00 Fed Chair Powell Speaks
  • 13:30 US Core Retail Sales. Estimate 0.4%
  • 13:30 US Retail Sales. Estimate 0.0%
  • 15:00 US Business Inventories. Estimate 0.6%

Tuesday (March 12)

  • 1:00 Fed Chair Powell Speaks
  • 13:30 US CPI. Estimate 0.2%
  • 13:30 US Core CPI. Estimate 0.2%

*All release times are EST

*Key events are in bold

XAU/USD for Monday, March 11, 2019

XAU/USD March 11 at 12:35 EST

Open: 1298.90 High: 1299.15 Low: 1291.08 Close: 1292.74

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1243 1261 1284 1306 1326 1344

XAU/USD posted slight losses in the Asian and European sessions. The pair continues to lose ground in North American trade

  • 1284 is providing support
  • 1306 is the next resistance line
  • Current range: 1284 to 1306

Further levels in both directions:

  • Below: 1284, 1261 and 1243
  • Above: 1306, 1326, 1344 and 1365