Improved Chinese HSBC Services PMI Might Help Risk Sentiment04 March, 2015 by Aayush Jindal in Market Analysis
- Currencies such as the New Zealand and the Aussie dollar were seen trading higher against the US dollar.
- Chinese HSBC China Services PMI was released by Markit Economics, which registered a healthy reading of 52.0 compared to the last reading of 51.8.
- In Japan, the Services Purchasing Managers Index (PMI) was released by Markit Economics, which registered a contraction with a reading of 48.5 in February 2015.
- GOLD managed to find buyers around the $1200 level with resistance ahead at $1210-15.
Chinese HSBC Services PMI
Earlier during the Asian session, the Chinese HSBC Services PMI was released by Markit Economics. The expectation was not of that high, compared to the last reading of 51.8. However, the outcome was a positive one, as the Chinese HSBC services PMI registered an expansion with a reading of 52.0 in February 2015. This was one of the highest gains in the past five months.
The report stated that the stronger growth of total business activity was noticed, and which was well supported by rapid increases in output across both the manufacturing and service sectors. When we look at the manufacturing sector, then output rose sharply and at the quickest rate since last August. On the other hand, the services sector activity growth gained slightly since January.
GOLD recently fell sharply to trade as low as $1188 where buyers managed to protect the downside. It is currently moving/correcting higher towards an important resistance area at $1210. There is a bearish trend line on the daily chart as well, which is coinciding with the mentioned resistance level.
Moreover, just above the highlighted trend line the 100-day simple moving average is aligned with the 23.6% fib retracement level of the last leg from the $1307 high to $1188 low.
Let us see whether GOLD can break higher or not. On the downside, initial support is around the $1200 level, followed by the last swing low of $1188.
US Services PMI
Later during the NY session, the US Services Purchasing Managers Index (PMI) will be released by Markit Economics. The forecast is slated for an increase from the last reading of 54.2 to 54.8. If the outcome fails to match the expectation, then GOLD might gain bids in the near term.