- Opened positions for Gold are strongly positive (72% bullish / 28% bearish)
- It is possible that Gold will grow in price, with the closest resistance for it located at 1,192
- At the same time, the probability of a downside movement exists as well, while for that purpose the closest support is placed at 1,168
- Upcoming events: Swiss KOF Economic Barometer, US Unemployment Claims and Crude Oil Inventories, Japanese Monetary Policy Meeting Minutes
Gold remained close to its three-week low amid weaker oil prices, global equities and the US Dollar strength. Wall Street closed at historic highs on Monday, bolstering global equities. The Dollar index, which measures the Greenback's strength versus a basket of major currencies, was hovering around the highest level in nine years. Increasing equities and a high Greenback dampen the demand for the yellow metal as a safe-have asset, while falling oil prices sap gold's lure as a hedge against oil-driven inflation.
Additionally, American home re-sales plunged to the lowest level in six months in November following two consecutive months of solid growth, highlighting uneven recovery in the residential real estate. Sales of previously owned homes slumped 6.1% to a 4.93 million annual rate last month, the weakest level since May, down from 5.25 million in the preceding month, the National Association of Realtors said. November's sales, however, edged up 2.1% from the previous year and followed a particularly strong October, when sales rose to their highest level of the year. November's sharp drop is unlikely to signal the beginning of a weakening trend, while partly reflects low inventories, which declined to the lowest level in eight month, providing buyers with limited options.
Japanese data to drive Gold during Christmas period
Among all fundamental statistics that is going to be released in the middle of this week, the most attention should be paid to the monetary policy meeting minutes of the Bank of Japan, even though the publication of them is awaited in the night between Wednesday and Thursday. In addition to that, US authorities are ready to release the weekly data on jobless claims and oil inventories in the country.XAU/USD returns back below down-trend
The XAU/USD cross has breached the most important resistance line, represented by the long-term downtrend and developed above this level for the past week. However, on December 15 Gold returned back, mostly amid fundamental factors. At the moment the most considerable resistance is represented by this long-term downtrend line, which is currently located at $1,205 and strengthened by the monthly R1, weekly PP and 55-day SMA. Nevertheless, by the end of the year we are still suggesting Gold to depreciate and trade in the direction of the monthly pivot point at $1,168.Daily chart
On Monday, the bullion declined in price considerably, losing around $25 per ounce to reach the weekly S1 at $1,177. This level is strengthened by the 2013 low from above, meaning that it is strong enough to give the XAU/USD some bullish impetus in order to grow. Despite the yesterday's move, weekly technical indicators are still suggesting that Gold will drop even more. If the price crosses the current support, it has a good chance to fall down to monthly PP / Bollinger band around $1,165 in the foreseeable future.
Hourly chart
Long opened positions decreased slightly
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Nov 23 and Dec 23 expect, on average, to see Gold trading just above 1,200 by the mid-March. At the same time, 46% of them believe the bullion will be above this mark in three months, while one third of traders surveyed forecast the bullion to trade in the range between 1,050 and 1,200.