- Gold price was recently boosted against the US Dollar, as oil price surged higher due to the OPEC production curd deal.
- The price is currently approaching a major resistance area, which must be cleared for further gains.
- In China today, the Caixin Manufacturing PMI™, released by Markit Economics came in at 50.1 in Sep 2016.
Caixin China Manufacturing PMI
There were many economic events lately, which impacted the market sentiment for commodity prices. Gold price and oil price got boost from the recent oil production curd deal. It helped the bulls in gaining momentum.
Today during the Asian session, the Chinese Caixin Manufacturing PMI™ was released by Markit Economics. It is compiled based on questionnaires sent to purchasing executives in over 400 private manufacturing sector companies, and was forecasted to increase from 50 to 50.1.
The outcome was just as the market expected. There was an expansion with a reading of 50.1.
Commenting on the report, the Director of Macro, Dr. Zhengsheng Zhong, stated “the Caixin China General Manufacturing PMI for September edged up slightly from the August level to 50.1, above the neutral 50-point level separating expansion from contraction. The index readings for new orders and stocks of purchases improved from the previous month while the reading for output slipped, but remained in expansion territory”. Overall, the report was on the positive side, and helped the risk sentiment in favor of the Gold buyers.
Gold Price Technical Analysis
Gold price recently traded as low as $1316 against the US Dollar where buyers appeared. There were a couple of attempts to break the stated level, but sellers failed. As a result, there was an upside reaction.
The price moved above the 23.6% Fib retracement level of the last drop from the $1342 high to $1316 low. However, it faces a major hurdle in the form of a bearish trend line on the hourly chart of XAU/USD.
If somehow the Gold buyers manage to clear it, the next resistance is at 100 hourly simple moving average. It also coincides with the 50% Fib retracement level of the last drop from the $1342 high to $1316 low and holds a lot of importance. If there is a break and close above it, Gold price may regain a lot of strength in the near term.
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