Daily Market Roundup: Disconnect between paper and physical gold market; US retail sales due, EUR/USD eyes 1.10

Nick Batsford, CEO of Tip TV, was alongside Zak Mir, technical analyst for Zak’s Traders Café, and Charlie Gibson, Head of Mining for Edison Research, when he opened the Tip TV Finance Show to discuss the US retail sales and the impact on the EUR/USD, as well as an outlook for Gold, LGO, PROX and CNEL.

US retail sales due, EUR/USD eyes 1.10

Batsford highlighted FX Street, who noted that the US retail sales are expected to come in at 0.3%, with the previous number being 0.1%. They continued that a horribly weak number could force markets to consider the possibility of a smaller lift-off, in the region of 10bps. In terms of the EUR/USD, we may see a weekly close above 1.10 if the retail sales beat estimates, and this would open the door for 1.1087-1.1120 ahead of next week’s FOMC meeting.

Outlook on Gold, LGO, PROX and CNEL

Gibson outlined that gold has been relatively resilient, but there is a huge disconnect between the physical market and the paper market. Mir added that gold has held around $1070, and if the Fed doesn’t raise rates we would see some major upside, although this is unlikely.

In terms of LGO, Mir believed that the stock appears to be experiencing a falling wedge formation, and he commented that the trend is down with the sinking oil price, but don’t rule out a rally towards the 50-DMA.

PROX is also experiencing a falling wedge formation, expressed Mir, and the 50-DMA was the target for this stock, with 0.9p being the longer-term target.

He finished on CNEL, which he noted bounced of November resistance, and now retracement towards the best levels on the stock is possible.

US, US retail sales, EUR/USD, FOMC, Fed, Federal Reserve, interest rates, rate hike, Gold, LGO, PROX, CNEL, physical, paper, falling wedge