Yahoo Finance Gold Price Prediction – Gold Forms a Doji Day Following Weak Housing Data
Gold prices rebounded from session lows following the softer than expected U.S. housing starts data which knocked down the dollar and paved the way for a rebound in the yellow metal. Gold prices formed a doji day with a long tail, which is generally a sign of indecision, but the rebound shows the rejection of lower prices. Target support is seen near the July 2017 lows at 1,204. Resistance is seen near the 10-day moving average at 1,245. Momentum remains negative as the MACD line recently generated a crossover sell signal and the MACD histogram is printing in the red with a downward sloping trajectory which points to lower prices. Short-term gold is oversold as the fast stochastic is printing a reading of 11, below the oversold trigger level of 20, which could foreshadow a recession.
U.S. housing starts plunged
U.S. housing starts plunged 12.3% to 1.173 million in June after rising 4.8% to 1.337 million in May which was revised form 1.350 million and April was bumped down to 1.276 million from 1.286 million. Expectations were for a flat reading. June single family starts dropped 9.1% versus the 5.1% prior increase with multifamily starts sliding 19.8% from 4.0%. Building permits declined 2.2% to 1.273 million following the 4.6% drop to 1.301 million previously. Starts have contracted at a -4.2% year over year versus 19.2% year over year. Sales declined in all four regions surveyed, led by a 35.8% drop in the Midwest.
Eurozone HICP inflation was confirmed
Eurozone HICP inflation was confirmed at 2.0% year over year with the final June reading, as expected. The uptick from 1.9% year over year in May was largely due to higher energy price inflation, which accelerated to 8.0% year over year from 6.1% year over year. Excluding energy the rate declined to 1.3% year over year from 1.4% year over year and core inflation actually fell back to 0.9% year over year from 1.1% year over year in May and versus 1.0% year over year in the preliminary reading. Services price inflation fell back to 1.3% year over year from 1.6% year over year.
This article was originally posted on FX Empire
