Gold Awaits Clues On Fed Rate Hike

Gold Awaits Clues On Fed Rate Hike

• US home resales fell more than expected in July after four straight months of strong gains, as a lack of inventory limited choice for buyers, but further price rises suggested the housing market remained on solid ground. Existing home sales declined 3.2% to an annual rate of 5.39 million units last month. It blamed the drop in sales on the dearth of properties on the market, which lifted the median house price 5.3% from a year ago. A separate report from the Federal Housing Finance Agency showed house prices rose 1.2% in the second quarter. They were up 5.6% from the second quarter of 2015.
• Yellen is scheduled to address a meeting of central bankers in Jackson Hole, Wyoming, on Friday, and recent comments from Fed policymakers have raised investors' expectations that she might adopt a less cautious tone on rates.
• Gold may be in a defensive mode for today and tomorrow as there are not many market-moving data points apart from what Yellen is going to say on Friday. Any hawkish comments could turn gold prices bearish next week. Rising US interest rates typically increase the opportunity cost of holding non-yielding bullion and boost the dollar, which makes it more expensive to buy gold for those holding other currencies.
• We closed our short-term gold position yesterday at 1325.00 and stay flat now.

USD/JPY: Sell At 101.40

• Japan's government kept its assessment of the economy unchanged in August but offered a slightly more downbeat view on consumer inflation than last month, as prices slid on weak household spending and the strong yen pushed down import costs.
• "Japan's economy continues to recover moderately, though weakness in some areas can be seen recently," the Cabinet Office said in a monthly report for August. The assessment was unchanged from last month.
• The report also said consumer prices were "flat," a gloomier view than last month when it said price rises were slowing. The last time the government used the word "flat" to describe consumer inflation was in April 2015, when the economy was still reeling from the hit to consumption from a sales tax hike implemented in April 2014.
• The report offered a brighter view on public investment to say it was holding firm, reflecting increased public works spending from government measures to prop up the economy. In July, the report said public investment was falling gradually.
• Japan's economic growth ground to a halt in April-June and any rebound in the current quarter will be modest as weak global growth and the yen's 20% rise against the dollar so far this year hurt exports and capital expenditure.
• Renewed yen gains and weak consumption have also weighed on inflation. Core consumer prices fell 0.5% in June from a year earlier, marking the biggest annual decline since 2013, keeping the Bank of Japan under pressure to expand stimulus to achieve its 2% inflation target.
• Markets are simmering with speculation the BOJ will ease monetary policy at its next rate review in September, when it conducts a comprehensive review of the effects of its existing stimulus programme. The government also plans a JPY 13.5 trillion fiscal stimulus package to spur growth.
• The volatility on the USD/JPY low and the rate is still inside August 16’s breakdown session. We are looking to sell USD/JPY at 101.40, below daily high on August 15.

FOREX - MAJOR PAIRS:

FOREX - MAJOR CROSSES:

PRECIOUS METALS:

It is usually reasonable to divide your portfolio into two parts: the core investment part and the satellite speculative part. The core part is the one you would want to make profit with in the long term thanks to the long-term trend in price changes. Such an approach is a clear investment as you are bound to keep your position opened for a considerable amount of time in order to realize the profit. The speculative part is quite the contrary. You would open a speculative position with short-term gains in your mind and with the awareness that even though potentially more profitable than investments, speculation is also way more risky. In typical circumstances investments should account for 60-90% of your portfolio, the rest being speculative positions. This way, you may enjoy a possibly higher rate of return than in the case of putting all of your money into investment positions and at the same time you may not have to be afraid of severe losses in the short-term.
How to read these tables?
1. Support/Resistance - three closest important support/resistance levels
2. Position/Trading Idea:
BUY/SELL - It means we are looking to open LONG/SHORT position at the Entry Price. If the order is filled we will set the suggested Target and Stop-loss level.
LONG/SHORT - It means we have already taken this position at the Entry Price and expect the rate to go up/down to the Target level.
3. Stop-Loss/Profit Locked In - Sometimes we move the stop-loss level above (in case of LONG) or below (in case of SHORT) the Entry price. This means that we have locked in profit on this position.
4. Risk Factor - green "*" means high level of confidence (low level of uncertainty), grey "**" means medium level of confidence, red "***" means low level of confidence (high level of uncertainty)
5. Position Size (forex)- position size suggested for a USD 10,000 trading account in mini lots. You can calculate your position size as follows: (your account size in USD / USD 10,000) * (our position size). You should always round the result down. For example, if the result was 2.671, your position size should be 2 mini lots. This would be a great tool for your risk management!
Position size (precious metals) - position size suggested for a USD 10,000 trading account in units. You can calculate your position size as follows: (your account size in USD / USD 10,000) * (our position size).
6. Profit/Loss on recently closed position (forex) - is the amount of pips we have earned/lost on recently closed position. The amount in USD is calculated on the assumption of suggested position size for USD 10,000 trading account.
Profit/Loss on recently closed position (precious metals) - is profit/loss we have earned/lost per unit on recently closed position. The amount in USD is calculated on the assumption of suggested position size for USD 10,000 trading account.
Source: GrowthAces.com - Daily Forex And Precious Metals Signals