Gold Poised for Bullish Reversal amid US Jobless Claims Data

Gold inched lower on Friday, decreasing the price of yellow metal to less than $1290.00 an ounce following some key economic releases. The technical bias remains bullish because of a higher high in the recent upside move.

XAU/USD Technical Analysis

As of this writing, the precious metal is being traded near $1285 an ounce. A hurdle can be noted near $1300, a key psychological level ahead of $1357, the high of the last major upside rally on the daily chart and then $1400, the psychological level. A break and daily closing above the $1400 level shall trigger renewed buying interest, validating a rally towards the $1440 resistance zone.

On the downside, a support may be noted around $1270, an immediate horizontal support ahead of $1250, the psychological level as well as another key horizontal support area and then $1200, a major psychological number. The technical bias shall remain bullish as long as the $1200 support area is intact.

US Jobless Claims Data

The number of people who filed for unemployment assistance in the U.S. last week increased more than expected, official data showed on Thursday.

The number of individuals filing for initial jobless benefits in the week ending November 3 increased by 10,000 to a seasonally adjusted 239,000 from the previous week’s total of 229,000, the U.S. Department of Labor said.

Analysts expected jobless claims to increase by 2,000 to 231,000 last week.

The four-week moving average was 231,250, down 1,250 from the previous week. The monthly average is seen as a more accurate gauge of labor trends because it reduces volatility in the week-to-week data.

Trade Idea

Considering the overall technical and fundamental outlook, buying the precious metal around current levels appears to be a good strategy in short to medium term.

 

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Usman Ahmed

Usman Ahmed is an individual forex trader and market analyst. He holds a Masters of Business Administration (MBA) degree. His work includes fundamental and technical reports on various currency pairs, commodity futures and stock markets. His technical analysis features price action strategies.

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