Gold prices moved higher on Thursday following stronger than expected inflation data released in China. Both PPI and CPI beat expectations lifting the yellow metal to a one month high. Resistance is now seen near the October highs at 1,306. Support is seen near the 10-day moving average at 1,276. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).
China’s Inflation Was Stronger than Expected
China’s consumer inflation increased to 1.9% in October, year over year compared to expectations that CPI would rise by 1.8% according to the National Bureau of Statistics. This compares to a 1.6% increase in September. Prices at the wholesale level surged 6.9% year over year but was unchanged from September. Expectations were for PPI to rise by 6.6%.
This article was originally posted on FX Empire
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