Since staging a strong four-day bull trek, the precious yellow metal prices ran into the supply (seller) on Thursday.
Investors on Thursday examined data showing that the number of Americans filing first-time unemployment claims last week rose by 23,000 to 230,000, the U.S Labour Department said on Thursday.
After the CPI data on Wednesday showed U.S. consumer prices in 2021 rose at the fastest pace in four decades, the U.S. Labour Department released the Producer-Price Index, which rose 0.2% in December from the prior month, the slowest pace since November 2020.
However, according to figures, year-on-year hit a 9.7% rise, its highest level on record.
The producer price index, which measures changes in the price of goods and services from a producer perspective, was expected to increase 9.8% last month.
Based on the technical aspect, the Relative Strength Index (RSI) 3-daily ‘lookback’ indicator has buckled, although remains positive, while the Moving Average Convergence Divergence (MACD) supports a positive signal.
As the prices of spot gold wobble above the $1,800, a bull trap could be looming as we view renewed hesitation towards the $1,828-33 level, with $1,840-42 seen as a broader term cap.
A rejection is expected from this region.
If seen, it would set up a move back towards the region of the two key levels at $1,788-92 and the broad base (support) at $1,757-64. Reassess from there.