On Friday (in GMT terms) gold for delivery in December traded within the range of $1,243.2-$1,267.6. Futures closed at $1,251.9, edging down 0.09% compared to Thursday’s close. It has been the 189th drop in the past 354 trading days and also a sixth consecutive one. The daily low has been a level unseen since June 7th, when the commodity went down as low as $1,236.5 per troy ounce. In weekly terms, gold futures lost 4.95% of their value during the past week. It has been the 19th drop in the past 40 weeks, a second consecutive one and also the sharpest one since the week ended on September 15th 2013. The precious metal has increased its drop to 4.95% so far during the current month, after gaining 0.43% in September.
On the Comex division of the New York Mercantile Exchange, gold futures for delivery in December were advancing 0.97% on Monday to trade at $1,264.1 per troy ounce. The precious metal went up as high as $1,266.7 during late Asian trade, while the current daily low was at $1,258.5 per troy ounce, recorded during the early phase of the Asian trading session.
The US Dollar Index, a gauge reflecting the relative strength of the greenback against a basket of 6 other major currencies, was edging up 0.20% on the day at a level of 96.71, after going up as high as 96.77 earlier. On Friday the index climbed to 97.22, which has been its highest level since July 27th. The gauge has pared its advance to 1.37% so far in October, following a 0.65% drop in September.
On Friday gold futures initially tested the area just below the $1,270 mark after the report on US Non-farm Payrolls came in below expectations, but later reversed their direction, falling to fresh lows not seen in four months. After a five-day losing streak, gold plunged to levels, which market players perceived as reasonable enough to go long the metal. This resulted in a sharp rebound from the four-month low of $1,243.2.
According to the US Bureau of Labor Statistics, employment in all sectors, with the exclusion of farming, grew by 156 000 in September after a revised up figure of 167 000 in August. It has been the lowest growth in four months, which also missed market consensus pointing to 175 000 new jobs. At the same time, the rate of unemployment in the country was reported to have risen to a five-month high of 5.0% last month from 4.9% in August. Market expectations pointed to a stable rate.
The report on non-farm employment growth, though weaker-than-anticipated, obviously was seen as one consistent with the Federal Reserve Banks intentions to further tighten monetary policy, especially after the recent solid data regarding US consumer sentiment, and activity in manufacturing and services sectors of the economy. Investor rate hike expectations in a medium term seemed to have been boosted.
According to CME’s FedWatch Tool, as of October 7th, market players saw an 8.3% chance of a rate hike occurring at the Federal Reserve’s policy meeting in November, down from 14.5% in the prior business day, and a 65.1% chance of a hike in December, up from 63.4% in the preceding business day. As far as the February 1st 2017 meeting is concerned, the probability of such a move was seen at 67.9% on October 7th, up from 65.6% in the prior business day.
Meanwhile, silver futures for delivery in December were gaining 2.46% on the day to trade at $17.807 per troy ounce, after going up as high as $17.832 a troy ounce during the mid phase of the European trading session.
Daily, Weekly and Monthly Pivot Levels
By employing the Camarilla calculation method, the daily levels of importance for gold are presented as follows:
R1 – $1,254.1
R2 – $1,256.4
R3 (Range Resistance – Sell) – $1,258.6
R4 (Long Breakout) – $1,265.3
R5 (Breakout Target 1) – $1,273.2
R6 (Breakout Target 2) – $1,276.5
S1 – $1,249.7
S2 – $1,247.4
S3 (Range Support – Buy) – $1,245.2
S4 (Short Breakout) – $1,238.5
S5 (Breakout Target 1) – $1,230.6
S6 (Breakout Target 2) – $1,227.3
By using the traditional method of calculation, the weekly levels of importance for gold are presented as follows:
Central Pivot Point – $1,272.6
R1 – $1,301.9
R2 – $1,352.0
R3 – $1,381.3
R4 – $1,410.7
S1 – $1,222.5
S2 – $1,193.2
S3 – $1,143.1
S4 – $1,093.1
In monthly terms, for the yellow metal we have the following pivots:
Central Pivot Point – $1,326.7
R1 – $1,348.0
R2 – $1,378.8
R3 – $1,400.1
R4 – $1,421.3
S1 – $1,295.9
S2 – $1,274.6
S3 – $1,243.8
S4 – $1,212.9
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