Gold prices moved higher bouncing at support near the session lows. The dollar found traction and ripped higher and is now poised to break out. This comes following a stronger than expected U.S. ADP private payroll report. U.S. short term Treasury yields moved higher which helped buoy the greenback. Since gold is priced in U.S. dollars, a stronger U.S. currency makes gold less attractive in other currencies.
Gold prices closed higher despite a stronger dollar. Resistance is seen near the 50-day moving average at 1,782. Support is seen near the 10-year moving average at 1,751. Short-term momentum is positive as the fast stochastic recently generated a crossover buy signal. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy 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 positive territory with an upward sloping trajectory which points to higher prices.
Private Payrolls Rise More than Expected
ADP and Macro-Economic Advisors reported that private jobs rose by 568,000 for the month, better than the estimate of 425,000 and ahead of the downwardly revised 340,000 reading in August. The initial August report showed growth of 374,000. Services dominated, with 466,000 new hires, helped by education and health services with 66,000, professional and business services with 61,000, and 54,000 from trade, transportation and utilities.
This article was originally posted on FX Empire