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US jobless claims fall near record lows; Gold test prior support

3:14 PM December 13, 2018

Summary:

  • US initial jobless claims: 206k vs 226k exp

  • Metric falls close to its lowest level on record

  • USD moving higher as Gold falls to possible support at 1240

 

The latest look at the US labour market has delivered some surprisingly good news with the number of people claiming unemployment benefits falling more than expected. The initial jobless claims for the past week came in at 206k vs an expected 226k, down on the prior reading of 233k (revised higher from 231k beforehand). The 4-week moving average fell to 224.75k vs 228.5k previously.  

There was a sharp drop in initial jobless claims in the past week which fell not far from the record low seen in September. The 4 week moving average has been rising of late but may now turn lower once more. Source: XTB Macrobond

 

Despite a miss in the latest NFP report, it is still pretty clear that the labour market in the US is robust and not far from full levels of employment. There’s been a clear downtrend in initial jobless claims in recent years and today’s data does little to suggest this will end anytime soon. The US dollar is trading a little higher on the whole on the day and this data should support strength in the greenback.

 

The US dollar is rising a little today with the largest gains seen against the Brazilian Real. There’s not been major moves against the other G10 currencies with the largest being 0.3% vs the Aussie. Source: xStation

 

The recent strength in the buck has put a cap on gains seen in the price of Gold and the precious metal has fallen back today to test prior support around 1240. Buyers have stepped in here and defended the level for now but it could be worth watching closely going forward. On the upside 1250 has previously acted as resistance and for the time being the market seems to be trading in this $10 range.

Gold has fallen to test the lower bound of its recent range today at 1240 and this may be seen as possible support. On the upside 1250 may offer resistance. Source: xStation

 

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