Senior Trader Daily Update 2 November 2017

Good morning everyone.
 
Choppy trading within the recent range for precious metals was seen in reaction to the release of a raft of economic data and ahead of the US Federal Reserve’s FOMC monetary policy statement, which ultimately saw the FOMC vote unanimously to leave interest rates unchanged, in line with market expectations.
 
On the economic data front;

• U.S. ADP (Oct) came in +235K (vs +200K expected & negative revised +110K for Sep which was previously +135K)
• U.S. Construction Spending (Sept) was +0.3% (vs Unchanged expected & negative revised +0.1% for Aug which was previously +0.5%)
• U.S. ISM (Oct) came in at 58.7 (vs 59.4 expected and 60.8 in Sep)

 
From the FOMC statement;
 

• "Inflation on a 12-month basis is expected to remain somewhat below 2 percent in the near term but to stabilize"
• "Near-term risks to the economic outlook appear roughly balanced"
• "The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate"

 
President Trump has yet to announce his choice for the next Chairman of the US central bank but consensus is that Jerome Powell (the status quo candidate) will get the nod on Thursday.
 
Also on Thursday will be a monetary announcement from the Bank of England. Then on Friday comes the latest US Bureau of Labor Statistics employment data for October with market consensus forecasting a 312,000 increase in Non-Farm Payrolls and a 4.2% Unemployment Rate according to Bloomberg.
 
Technically, XAU/AUD remains trapped within a well-defined wedge-congestion zone bounded between approximately AUD 1636.50 and just beneath AUD 1670.
 
Likewise, XAU/USD remains supported above the 200 Day moving average (USD 1260) with resistances emerging at USD 1280.50 (trendline resistance), USD 1281.50 (21 Day moving average), USD 1297.00 (55 Day moving average) and USD 1300.00 (big figure psychological resistance).
 
Good luck!
 
Regards,
Andre