Global macro overview for 25/02/2016:
The US New Home Sales data were released yesterday and the numbers were lower than market expectations. The house market slid to 494k ( -9,2% m/m) as the foretasted number was 522k (-3,2%m/m). Moreover, the CB consumer confidence index has underscored as well when it decreased to 92.2 from 97.8 a month before, well above the estimate of 97.4. To conclude, we might notice, that weaker consumer sentiment might indicate a decrease in consumer spending, which is the key driver of economic growth. Moreover, the US economy is showing signs of weakness in 2016 as per new home sales data, so the nervous market participants might invest more in traditional safe-heaven assets, like gold.
Gold prices have jumped some 16% in 2016, so let's take a look at its technical picture. Sharp recovery from the important support at the level of 1191 indicates that bulls are still in full control in this market. Currently, the next important resistance is seen at the level of 1263 and if broken, then bulls might even try to test the level of 1307.