Gold prices eased despite a falling dollar and lower yields. The yellow metal was unable to gain traction and traded sideways following a smaller than expected increase in retail sales. Industrial production also increased 3% which was in line with expectations following a robust rise in June. For the week gold prices were down nearly 5%.
Trade gold with FXTM
Gold prices eased on Friday and finished up the week down nearly 5%. Resistance is seen near the 10-day moving average at 1,987. Target support is seen near the 50-day moving average at 1,839. Short-term momentum has turned negative as the fast stochastic moved lower but it appears that the momentum index is decelerating reflecting some consolidation. Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the red with a declining trajectory which points to accelerating negative momentum.
US Retail Sales Rose Less than Expected
US retail sales rose 1.2% in July, versus the expected increase of 2.3%. Excluding autos, the gain was 1.9%, ahead of the 1.2% estimate. Industrial production, including output at factories, mines and utilities, rose climbed 3% in July after surging 5.7% in June. Production remains 8.4% below its level in February before the spread of COVID-19 the United States.
This article was originally posted on FX Empire
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