Forex Trading Pips Live Update, Thursday 16th August

by Joe Oliver, Forex Trading-Pips

Gold is back in the headlines after Billionaire George Soros is reported to have increased his stake in the biggest exchange traded fund SPDR Gold Trust from 319,550 to 884,400 shares as of June 30 from three months earlier.

Gold is currently trading in a descending triangle formation and range bound, as indicated by all key Moving Average indicators which are flat lined. Key levels to watch are a break up through 1650, or a break down through 1500. It’s possible we get a false break one way or the other before the ‘real’ move gets going. One of the best things about triangle consolidation breakouts is that stops can be set reasonably close as volatility is contracted, with potentially high reward to risk payoff.

Gold daily bars

Gold daily bars

In other news Chinese Premier Wen Jiabao said on Wednesday that there is “growing room for monetary policy operation”. FDI in China fell 8.7 percent from a year earlier to $7.58 billion according to data released from the Ministry of Commerce in Beijing today.

The Chinese yuan (renminbi) declined for a second day on Thursday as the Chinese Central Bank lowered its daily rate to its lowest level since November.  1US$ is currently equal to 6.3663 RMB. China is attempting to support its export market which slowed sharply in July.

The British pound traded higher on Thursday after UK retail sales beat expectations, rising 0.3% from June. Annual sales came in at 3.3% in July versus expectations of a fall to 2% and core sales rising 2.8% from 1.6%. Gains are currently capped at 1.5730 as trades question how sustainable recent improvements will be following the end of the Olympics last week .