U.S. retail sales in August were better than expected, and gold prices entered "no man's land" after falling by more than $40

GMT+8 At 20:30 on September 16, data released by the US Department of Commerce showed that after a decline of 1.8% in July, retail sales in the United States increased by 0.7% in August, while the market’s general forecast is a drop of 0.8%. After the data came out, the price of gold fell by more than $40. Analysts said that because the US economic outlook changed before the Federal Reserve announced interest rates, the current gold price is in a "no man's land"-both long and short sides are hesitant.



Phil Streible, chief market strategist at Blue Line Futures, said that the main catalyst for the gold sell-off is retail data. The strengthening of the US retail industry may mean that the Fed will be tougher in the future. He believes that retail data is unlikely to affect the Fed's interest rate decision next week, but the Fed will admit that they are monitoring related progress.

Because the price of gold fell more than US$40, close to US$1750 per ounce, it caused great damage to the technical side. Streible said that he is not sure whether the price of gold will rebound from now on. The price of gold faces strong resistance in the range of $1795 to $1810, and the downside support is slightly below $1700.

Daniel Ghali, commodity strategist at TD Securities, said that it is curious that gold has not found new buyers, especially when the media is concerned about stagflation.

He added: “Fund managers are looking for better opportunities. Once the price of gold finds support in the technical support range of US$1,750 per ounce, it will remain near US$1,800 for a period of time. We see investors’ speculative interest in gold. Very small, the gold held by ETFs has basically not changed."

On September 16, Edward Moya, senior market analyst at OANDA, said that whether the price of gold can hold $1,750 will determine whether it rebounds or encounters another sell-off. He also said that gold bulls may be disappointed.

Moya also said that in the past two weeks, despite increasing calls for caution on the US stock market, the price of gold has not rebounded sharply. Gold has fallen into a dangerous zone and can easily fall to the $1,700 level. Gold will be technically sorted for a period of time. If it closes below $1750, it may be very bad for gold holders. He also believes that since gold has clearly broken the consolidation model, it will continue to fluctuate.


(Spot gold daily chart)

GMT+8 At 8:33 on September 17, spot gold was quoted at $1754.99 per ounce.