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Gold Loosing its Ground

Gold losing its shine after the upbeat US data. Department of Labor and Bureau of Labor Statistics released Unemployment claims report and CPI data both of which exceeded the economist’s expectations.

Core CPI m/m: Actual-.2%, Forecast- .1%

Unemployment Claims: Actual- 297K, Forecast- 321K

On the 4 hour chart, we can see that Gold was trading within a rising channel pattern which it is trying to break. Breaking below the support trend line of the channel the pair will find the next support level at 1292.37 or 1287.20. On the stochastic oscillator also we can see that the %K line is above the %D line. So the downtrend will change to uptrend when %K line will cross down below the %D line.

Also the 50 day SMA is contracting towards the 200 day SMA to move down below it showing a bearish movement.