positive effects of missing data!
US economic data once again confirmed the slowdown in the US economy. According to the published data on Monday, even though the US August Dallas Fed business activity index increased to -12.9, up from -22.6 in July, it was worse than the -12.7 expected by the market and still in negative territory. Looking at the data in more detail shows that expect an increase in the new orders from -9.2 in July to -4.4 in August, other sectors performed much worse than expected, including manufacturing output index, manufactured goods price index, prices paid for raw materials, manufacturing employment, and manufacturing shipments.
After data was published yesterday, again with weaker than expected data, market participants played down the 75 bps rate hike possibility, and t caused some rebound in the market after last week's fall, following the FED chair speech in Jackson Hole.
Ahead of today's CB consumer confidence, stock markets can continue their slight gains and hold their side movement before Friday's employment numbers, where we can better understand the US economic condition.
In the bigger picture, since the future is unclear, we can see the effect on the gold price in the weekly chart. As shown in the bellow figure, yellow metal mostly moves between $1700 and $1,820. However, $1720 is the strong support in most timeframes, and breaching under this level can send it to much lower levels, which does not seem likely for now. Both fundamental and technical data confirm the side movement with a downtrend tendency for now before having a clearer outlook on the US economic condition.
