The economic data during the week from the US remained a mixed bag with the Conference Board’s one-year inflation expectation showing an ease down in inflation from 7.1% to 6.7%, and consumer confidence index spiked to eight months high of 108.3 in December from an upwardly revised 101.4 in November. However, the housing sector continued to reel from the higher mortgage rates pressure with permits for new buildings sliding 11.2% in November on an annual basis.
Existing home sales were down 7.7% from a year ago, but November New Home sales rose by 5.8%. The US-made durable goods order fell 2.1% in November along with a dip in US consumer spending by 0.1% despite personal income rising by 0.4% for the same period.
The market falls into the last leg of the year next week, with major markets observing the Christmas holiday on Monday, thus expecting thin volumes throughout the week. The pending home sales are expected to show decline in November, which should deter high moves in gold. The lack of economic data releases will keep gold prices in a narrow trading range, but low volumes could bring higher volatility.
Weekly Range Traders should be cautious of the thin volumes and any unfavorable Covid-19 related news could send gold prices higher next week, near-term support is at $1785/$1765 and the key resistance remains around $1840/1850.
(The author is Research Analyst at Sharekhan by BNP Paribas) (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
