Gold: Retail sales slump, but gold shrugs

Gold has started the week with small losses. In Monday’s North American trade, the spot price for one ounce of gold is $1290.56, down 0.14% on the day. On the release front, the U.S., retail sales and core retail sales both declined and missed their forecasts. On Tuesday, the U.S. releases durable goods orders.

Retail sales, the primary gauge of consumer spending, looked dismal in March. The indicator declined by 0.2%, shy of the estimate of +0.3%. Core retail sales declined by 0.4%, a sharp drop from the 0.9% gain a month earlier. Both indicators posted a second decline in three months, which is bound to raise concerns about the strength of the economy. Growth for the first quarter could be as low as 0.8% annualized, compared to 2.2% in the third quarter.

On Monday, there was pressure on gold, a safe-haven asset, as positive news out of China raised risk appetite. Chinese Caixin Manufacturing PMI didn’t sparkle, but improved to 50.8 and easily beat the estimate of 50.1 points. Investors cheered as the indicator climbed to an 8-month high, after posting three successive releases indicating contraction. The Chinese economy has been hit hard by the trade war with the U.S., and a piece of good news was enough to raise the confidence levels of investors.

Markets enter rally mode after China bounces back

U.S retail sales unexpectedly fall

XAU/USD Fundamentals

Monday (April 1)

• 8:30 US Core Retail Sales. Estimate 0.4%. Actual -0.4%
  
• 8:30 US Retail Sales. Estimate 0.3%. Actual -0.2%
• 9:45 US Final Manufacturing PMI. Estimate 52.5. Actual 52.4
• 10:00 US ISM Manufacturing PMI. Actual 55.3
• 10:00 US Business Inventories. Estimate 0.4%. Actual 0.8%
• 10:00 US Construction Spending. Estimate 0.1%. Actual 1.0%
• 10:00 US ISM Manufacturing Prices. Actual 54.3

Tuesday (April 2)

• 8:30 US Core Durable Goods Orders.  Estimate 0.3%
• 8:30 US Durable Goods Orders.  Estimate -1.1%

*All release times are EST

*Key events are in bold

XAU/USD for Monday, April 1, 2019

XAU/USD April 1 at 12:30 DST

Open: 1292.41 High: 1297.08 Low: 1288.28 Close: 1291.06

XAU/USD Technical

XAU/USD inched higher in the Asian session. The pair reversed directions and edged lower in European trade. In North American trade, XAU/USD posted gains but has retracted

• 1284 is providing support
• 1306 is the next resistance line
• Current range: 1284 to 1306
  

Further levels in both directions:

• Below: 1284, 1261 and 1243
• Above: 1306, 1326, 1344 and 1365

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