On Monday (in GMT terms) gold for delivery in December traded within the range of $1,258.5-$1,266.8. Futures closed at $1,260.4, edging up 0.68% compared to Friday’s close. It has been the 166th gain in the past 355 trading days and also the steepest one since September 22nd. The precious metal has pared its drop to 4.30% 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 edging down 0.13% on Tuesday to trade at $1,258.8 per troy ounce. The precious metal went up as high as $1,264.0 during early European trade, while the current daily low was at $1,257.4 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 0.33% on the day at a level of 97.23, after going up as high as 97.25 earlier. The latter has been the highest level for this index since July 27th. The gauge has extended its advance to 1.93% so far in October, following a 0.65% drop in September.
On October 7th 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. Having plunged to levels, which market players perceived as reasonable enough to go long the metal, futures sharply rebounded from Fridays four-month low of $1,243.2, while ending a six-day streak of losses. At the beginning of the current week gold seemed to have formed a relatively tight congestion area between the $1,256 and the $1,267 levels.
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 continued to increase.
Further clues on whether there still were diverging views on policy among FOMC members may be provided by the keenly anticipated Minutes from the Committees policy meeting held on September 20th-21st. The document is to be released on Wednesday.
According to CME’s FedWatch Tool, as of October 10th, market players saw an 8.3% chance of a rate hike occurring at the Federal Reserve’s policy meeting in November, or unchanged compared to the prior business day, and a 69.5% chance of a hike in December, up from 65.1% in the preceding business day. As far as the February 1st 2017 meeting is concerned, the probability of such a move was seen at 71.9% on October 10th, up from 67.9% in the prior business day.
Meanwhile, silver futures for delivery in December were inching down 0.04% on the day to trade at $17.652 per troy ounce, after going down as low as $17.617 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 – $1,261.2
R2 – $1,261.9
R3 (Range Resistance – Sell) – $1,262.7
R4 (Long Breakout) – $1,265.0
R5 (Breakout Target 1) – $1,267.6
R6 (Breakout Target 2) – $1,268.7
S1 – $1,259.6
S2 – $1,258.9
S3 (Range Support – Buy) – $1,258.1
S4 (Short Breakout) – $1,255.8
S5 (Breakout Target 1) – $1,253.2
S6 (Breakout Target 2) – $1,252.1
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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