Gold prices continued to rally Thursday, and are poised to test higher levels. The dollar continues to slide which paved the way for higher gold prices. The US yields also continued to move lower. US jobless rose more than expected putting upward pressure on gold prices.
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Gold prices finished at 8-year highs and continue to accelerate higher. Target resistance is now seen near the August 2011 all-time highs at 1,912. Support is seen near the 10-day moving average near 1,833. Medium-term momentum has reversed and turned positive as the MACD (moving average convergence divergence) histogram is printing in the black with an upward sloping trajectory points to higher prices. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. The fast-stochastic is printing a reading of 94 above the overbought trigger level of 80, which could foreshadow a correction. The RSI also surged higher reflecting accelerating positive momentum and is printing a reading of 80, above the overbought trigger level of 70 which could foreshadow a correction.
Jobless Claim Rise
Initial jobless claims came in at 1.416 million for the week ending July 18, according to the Labor Department. Expectations were for a rise to 1.3 million. It was the 18th straight week in which initial claims totaled more than 1 million, and it snapped a 15-week streak of declining initial claims. Continuing claims, which refer to those receiving benefits for at least two straight weeks, dropped by 1.107 million to 16.197 million for the week ending July 11.
This article was originally posted on FX Empire
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