- 48% of all SWFX open positions are long
- Gold opened Wednesday's session at 1326.00
- Economic events to watch over the next 24 hours: US Core Durable Goods Orders, Yellen's speech, Crude Oil Inventories
Crude oil inventories in the United States fell sharply last week, official data showed on Wednesday. According to the Energy Information Administration's weekly report, US crude stocks dropped 6.2 million barrels to a total of 504.6 million in the week ended September 16, compared to the preceding week's decline of 0.6 million barrels, while market analysts anticipated a rise of 3.2 million barrels in the reported week. The data also showed gasoline inventories decreased 3.2 million barrels, exceeding analysts' expectations for a 567,000 barrel fall, whereas distillate stocks added 2.2 million barrels, compared to the 250,000 increase forecast. On Tuesday, the American Petroleum Institute reported a 7.5 million drop in US crude oil inventories for the same week, surpassing the 3.4 million barrel fall market forecast.
Confidence among American shoppers rose unexpectedly to its highest level since the recession in September, official data revealed on Tuesday. According to the Conference Board, the Consumer Confidence Index (CCI) jumped to 104.1 in September, whereas market analysts expect it to come in at 98.6 in the reported period. Meanwhile, the preceding month's reading was revised up to 101.8 from the originally reported 101.1 points. The survey is a closely followed barometer of consumer attitudes towards business conditions, personal finances, jobs and short-term outlook. The data showed that 27.9% of respondents stated that jobs were plentiful in the ninth month of the year, following August's 26.8%. Furthermore, only 21.6% claimed that jobs were hard to find, compared to last month's 22.8%. The share of those expecting more jobs to be created in the upcoming months increased to 15.1% from last month's 14.4%, while the share of respondents expecting less jobs declined to 17.0% from August's 17.5%. The proportion of respondents expecting their incomes to worsen fell to 10.3% from 11.0% in the prior month. The US economy is mostly driven by consumer spending, which accounts for about 70% of all economic growth.
Upcoming fundamentals: US Core Durable Goods Orders
High impact data is bound to shake the markets on Wednesday afternoon, when the US Core Durable Goods Orders, Yellen's speech, as well as Crude Oil Inventory data comes out. Regarding the Durable goods announcement, -0.5 will be the figure defining a positive or negative surprise at 12:30 GMT, while Yellen's speech which takes place at 14:00, could cause the markets to behave unpredictably. US Crude Oil Inventory data comes out at 14:30 GMT as well.
XAU/USD up against 1317.98
Daily Chart: The three-month triangle proved its merit not only by limiting access to levels above 1339.61, but by causing a 1.1% dive right trough levels of significance to close at 1325.81. Opening with little volatility, Gold showed signs that an extension of the bear-trend might be on the way with some high impact fundamental data releases pushing the metal around against the Dollar on Wednesday. The lack of demand pressures in between opens the way to 1317.89, the bottom trend-line of the wedge, suggesting that the triangle has overpowered the senior wedge which could be mature enough to give in to the junior triangle.Daily chart
Hourly chart: The last four attempts at the 200-hour SMA at 1325.72 were unsuccessful, respecting the bearish bias that prevails. Currently probing the 1323.73 Bottom Bollinger Band, Gold is paving the way for a gloomy trend over the next few days, as lacking demand pressures between 1323.73 and 1317.45 could make the metal's way south a smooth one. Upward movements are restricted by 1325.72 and 1326.42 respectively, and we look for one of these areas to induce a sell-off if XAU/USD manages to elevate as high.
Hourly chart
Traders show mixed expectations on the bullion
Meanwhile, OANDA Bank clients are majorly bullish with respect to the bullion, meaning that 65.18% of all positions are long. In the meantime, SAXO bank clients show a similar trend with 62.05% of all positions being held by bulls.