Dec 1st – Top Economic Events On The Table vs. Gold

Happy Friday. This week, the market remained fundamentally driven, yet our trading signals helped us remain on the green side.  We have another series of major economic events to finish off the week from both the US and Canada. Let's take a look…

 

Top Economic Events Today

 

Great Britain Pound- GBP

Manufacturing PMI – At 9:30 (GMT), the Markit will be releasing the manufacturing figures which are forecasted to be 56.6% slightly above 56.3% from last month. Let me add that above 50.0 indicates industry expansion, while below indicates contraction. At the same time, we compare the updated figure with the previous figure to predict the direction of currency.

 

Canadian Dollar – CAD

Canada seems to be a leader of economic events today since we have three high impact economic events coming from their side.

 

Employment Change – Scheduled to be released at 13:30 (GMT) with a forecast of 10.2K which is a big drop from the previous month's figure of 35.3K. This figure shows the change in the number of employed people during the previous month.

 

Unemployment Rate – Economists are forecasting a drop to 6.2% from 6.3%. The markets usually move on the Unemployment rate and GDP figures in a long run. Employment change has a quick but short-lived impact.

 

GDP m/m – At the same time, we need to monitor the GDP figures. This is one of the main economic events used to gauge the performance of the economy. The Canadian economy is expected to grow by 0.1%. I'm keeping my eyes on this as any divergence in data will give us some good moves to catch in Canadian currency pairs today.

 

U.S. Dollar – USD

ISM Manufacturing PMI- This is a leading indicator of economic health – businesses react quickly to market conditions, and their purchasing managers hold perhaps the most current and relevant insight into the company's view of the economy. The data is due at 15:00 (GMT), right after the Canadian data. It will be interesting to see the volatility that results.

 

Gold – XAUUSD- Safe Haven Isn't Helping Anymore

The yellow metal tumbled in response to the series of better than expected economic events from the United States including the Jobless Claims, Personal Spending, and Chicago PMI. As we know, the stronger dollar makes the precious metal more precious for traders and they cut their demands for it.

China is the second biggest consumer of Gold right after India, which is first. Therefore, the Chinese economic figures impact the Gold prices. China's manufacturing activity fell to the weakest level in the past five months. The Manufacturing Purchasing Manager's Index (PMI) is down to 50.8 from 51.0 in October.

 

Technical View of Gold

Congrats guys, our long-term forex trading signal closed in profit. The outlook for Gold remains bearish but now it's holding in an area where technical indicators are lining up for the retracement.

Gold – 4 – Hour – Trading Range 

The RSI and Stochastics are signaling that Gold is heavily oversold and needs to retrace back up until $1,276 (38.2% Fibo)and $1,279 (61.8% Fibo).

Refer below to the trading levels for further help. To get a better understanding of the levels, check out one of the super-profitable support and resistance trading strategies.  

 

Gold – XAU/USD – Trading Levels

Support            Resistance

S1: 1,271              R1: 1,282

S2: 1,268             R2: 1,285

S3: 1,263             R3: 1,290

Key Trading Level: $1,277

 

Gold // XAUUSD – Trading Idea

It is recommended for traders to watch $1,277, today's crucial trading level. Below this, the gold is likely to stay bearish with a target of  $1,271 and $1,268.

 

Ending Remarks

Forex maniacs across the globe are sitting tight ahead of major economic releases today, particularly, the ones in the U.S trading sessions. If you are looking to trade gold profitability, I highly suggest you check out the FX Leaders article on Gold Trading.