Gold continues to show limited movement this week. In Thursday’s North American trade, the spot price for one ounce of gold is $1284.97, down 0.11% on the day. In economic news, there is only one key event on the calendar. In the U.S., employment claims dipped to 223 thousand, below the estimate of 225 thousand. On Friday, the focus will be on employment numbers, as the U.S. releases wage growth and nonfarm payrolls.

With the Federal Reserve continuing to send a dovish message to the markets, we may not see a rate hike in the first half of 2019. After four rate hikes last year, the Fed has become much more dovish, and this stance was reinforced by Jerome Powell in testimony before Congress. On Tuesday, Boston Fed President Eric Rosengren, who is a considered a hawk on monetary policy, said that there was some downside risk to the U.S. economy and called on policymakers to be “patient” for several more meetings in order to evaluate the risks to the economy. Without being explicit, Rosengren appears to support the Fed remaining on the sidelines for upcoming policy meetings until the Fed can better gauge the health of the U.S. economy.

It has been a rough March for gold, which has declined 2.0 percent. Gold is a traditional safe-haven asset, and stronger risk appetite is weighing on the base metal. Investors are confident that the U.S. and China will bury the hatchet and reach some agreement on trade and tariffs. The sides have completed four rounds of talks, and all signs are pointing to progress in the bitter trade war, which rocked the stock markets while propelling gold prices upwards. If there is a breakthrough in the talks, traders should be prepared for gold prices to drop sharply.

Attention on deficit disorder sinks stocks

ECB lifts stocks off lows and sinks euro

U.S dollar looking for direction

XAU/USD Fundamentals

Thursday (March 7)

  • 7:30 US Challenger Job Cuts. Estimate 117.2%
  • 8:30 US Revised Nonfarm Productivity. Estimate 1.5%. Actual 1.9%
  • 8:30 US Revised Unit Labor Costs. Estimate 1.7%. Actual 2.0%
  • 8:30 US Unemployment Claims. Estimate 225K. Actual 223K
  • 10:30 US Natural Gas Storage. Estimate -141B. Actual -149B
  • 12:15 US FOMC Member Brainard Speaks
  • 15:00 US Consumer Credit. Estimate 16.4B

Friday (March 8)

  • 8:30 US Average Hourly Earnings. Estimate 0.3%
  • 8:30 US Nonfarm Employment Change. Estimate 181K
  • 8:30 US Unemployment Rate. Estimate 3.9%
  • 8:30 US Building Permits. Estimate 1.29M
  • 22:00 US Federal Chair Powell Speaks

*All release times are EST

*Key events are in bold

XAU/USD for Thursday, March 7, 2019

XAU/USD March 7 at 12:10 EST

Open: 1287.92 High: 1290.98 Low: 1283.71 Close: 1286.85

XAU/USD Technical

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

XAU/USD showed limited movement in the Asian session. The pair edged lower in European trade but then recovered. XAU/USD is showing stronger movement in North American trade but has been unable to maintain any momentum

  • 1284 was tested earlier in resistance. It is a weak line
  • 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