Gold has inched higher in the Thursday session. In the North American session, the spot price for one ounce of gold is $1297.31, up 0.05% on the day. On the release front, U.S, unemployment claims ticked higher to 222 thousand, just below the estimate of 223 thousand. On Friday, G-7 leaders will gather in Quebec for their annual summit.
The upcoming G-7 meeting in Quebec is being closely monitored, as the summit comes at a time of escalating trade tensions between the U.S and some of its major trading partners. Last week, finance ministers from six members of the G-7 were united in their criticism of US Treasury Secretary Steve Mnuchin over the brewing trade war. The trouble started last week, when the Trump administration slapped stiff tariffs on Canada, Mexico and the European Union. This resulted in promises of retaliation, and Canada and Mexico have already announced duties on U.S products. The trade spat is sure to dominate the summit, but will the leaders resolve matters? If not, investors could head for the hills and dump their riskier assets in favor of safe-haven gold.
Gold prices have been steady in June, as the base metal continues to hover close to the $1300 level. Recent geopolitical hotspots include Italy and North Korea, but both of these are calmer this week, boosting risk appetite. Italy has formed a government after months of political drama, and the on-again-off-again summit between Donald Trump and Kim Jong-un will indeed take place in Singapore next week. Although no agreements are expected to be signed at the summit, both leaders are unconventional and could surprise the world with a dramatic breakthrough in the longstanding Korean conflict. If this occurs, risk appetite could sore and send gold prices downwards.
Thursday (June 7)
- 8:30 US Unemployment Claims. Estimate 223K
- 10:30 US Natural Gas Storage. Estimate 87B. Actual 92B
- 15:00 US Consumer Credit. Estimate 13.9B
Friday (June 8)
- Day 1 – G7 Meetings
*All release times are DST
*Key events are in bold
XAU/USD for Thursday, June 7, 2018
XAU/USD June 7 at 12:25 DST
Open: 1296.61 High: 1303.18 Low: 1294.96 Close: 1297.31
XAU/USD was flat in the Asian session. The pair posted gains in European trade but has retracted in North American trade
- 1285 is providing support
- 1307 is the next resistance line
- Current range: 1285 to 1307
Further levels in both directions:
- Below: 1285, 1260 and 1236
- Above: 1307, 1337, 1375 and 1416
OANDA’s Open Positions Ratio
XAU/USD ratio is unchanged in the Thursday session. Currently, long positions with a majority (70%), indicative of trader bias towards XAU/USD continuing to move to higher ground.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.