comex gold outlook

Gold ended lower on Friday as the dollar strengthened on the back of better-than-expected U.S. nonfarm payrolls data and manufacturing data.

According to the data, U.S. employers eliminated 51,000 non-farm jobs in July against market expectations for a payrolls decline of 75,000. But U.S. unemployment rate changed to 5.7 percent from 5.5 percent, its highest level in four years.

The unexpected recent data’s influenced the investors and provided some scope for the Federal Reserve to raise interest rates by year-end or early 2009.

But on Thursday gold rose to $925 level and settled at $912.85 as dollar dropped after weaker-than-expected U.S. job data and below-forecast economic growth in the second quarter.

International spot gold traded in the range $916.9 - $901.80 a Troy Ounce and last quoted at $909.55 ($912.85).

But data’s from different sectors are giving a mixed trend in the US economy

Standard & Poor's Case-Shiller home price index revealed that home prices in 20 major US cities have fallen a record 15.8% in the past year, and fell 1% in May compared with April.

Federal Reserve Board Governor Frederic Mishkin had said Monday that recent adverse shocks to the economy - including the financial market turmoil and the sharp increase in the price of oil - may affect the economy for longer than the next three years.

Meanwhile, the US Senate cleared a bill designed to prop up the struggling US housing market and rescue the struggling giant mortgage-buyers Fannie Mae and Freddie Mac on Saturday. The bill includes billions of dollars in loan guarantees, a tax break for first-time homebuyers and many other provisions.

The Federal Reserve's Beige Book report of economic conditions last week showed price pressures were intensifying even as growth slowed over the past month.

Weekly Outlook (Spot Gold)

Expecting weakness below $899.30, Otherwise expecting recovery. Supports are $ 893, $884, $873.Resistances $911, $920.60, $936.60

Last day DGCX Gold Oct traded in the range $921 – $906 and closed at $914.20

TECHNICAL OUTLOOK (Intra-day)

GOLD (Oct) - Bullish above $ 916.50; bearish below $ 911.3


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