Can GOLD Gain Traction despite Greece Exit Fears?03 July, 2015 by Aayush Jindal in Uncategorized
- GOLD continued to fall this week and followed a nice downtrend despite Greece exit fears.
- HSBC China Services PMI™, released by Markit Economics posted a decline from the last reading of 53.5 to 51.8 in June 2015.
- In Australia, the Retail Sales released by the Australian Bureau of Statistics registered an increase of 0.3% in May 2015, compared with the preceding month.
GOLD Technical Analysis
GOLD after opening the week on a positive note declined, and followed a nice bearish trend. There are a couple of major resistance trend lines formed on the hourly chart, which are acting as a barrier for more gains. Every time buyers manage to take the price higher, they find sellers around the highlighted trend lines.
Recently, the price tested the 38.2% Fib retracement level of the last drop from the $1187 high to $1156 low. Currently, the price is around the highlighted resistance zone, which means there is a risk of a break higher in the near term. If there is one more failure to trade higher, then the possibility of it trading lower might escalate moving ahead. The hourly RSI has just moved above the 50 level, which is a positive sign.
Chinese HSBC Services PMI
Earlier during the Asian session, the Chinese HSBC Services PMI, which is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 400 private service sector companies was released by Markit Economics. The forecast was of an increase from the last reading of 53.5 to 53.8 in June 2015. However, the outcome was lower than the forecast, as the Chinese HSBC Services PMI posted a decline to 51.8.
Commenting on the report, the Economist at Markit, Annabel Fiddes, stated that “Latest PMI data signalled a further loss of growth momentum in China’s economy at the end of the second quarter. In the service sector, business activity, new orders and employment all expanded at slower rates, while optimism towards the business outlook also moderated”.
Overall, the data was on the weaker side. There were a few more points to note, including the fact that there is an expectation of slower growth of activity and new orders, which might later lead to raise staff numbers at a weaker rate in June.