Article by: ETO Markets

A decrease in US initial claims for unemployment benefits the economy's resiliency and may persuade the Federal Reserve to postpone rate cuts for the time being. US weekly Initial Jobless Claims fell to 218K for the week ending February 3 from 227K the previous week, above the market consensus of 220K, according to data issued by the US Department of Labor on Thursday. The weekly total of Continuing Claims decreased by 23K to 1.891M on January 27.

After hitting an intraday low of $…, XAU/USD gained $10 and returned to its comfortable range. The daily chart shows that the pair is still hovering around a directionless 20-SMA, suggesting that it is technically neutral. The longer moving averages lose some of their upward power and stay well below the present level. Ultimately, technical indicators have stabilized around their midlines once again, indicating a lack of direction certainty.

The rising potential appears to be constrained in the foreseeable future. For a short while, XAU/USD fell below all of its moving averages, which are not very strong in any direction. However, it soon rose above the 20- and 100-SMAs. Meanwhile, technical indicators failed to offer any new information, turning back north but staying around neutral levels. The next resistance awaits around $….