At the end of last week, the price for gold failed to reach the psychological level at 1,740.00.
During Monday morning, the XAU/USD exchange rate consolidated in the 1,720.00 area.
This week starts with the US Advance GDP release on Wednesday at 12:30 GMT. This is the first of three types of US quarterly GDPs. The Advance release reveals the first Gross Domestic Product numbers of a quarter. The following Preliminary and Final GDPs usually reveal slight adjustments. In general, the data will reveal the first impact of the coronavirus on the US economy.
Afterwards, at 18:00 GMT, the Federal Reserve is bound to make a rate statement, which is bound to react to the ongoing economic decline. Take into account that the Federal Reserve Rate announcement and FOMC Statement are set to be followed by a Press Conference at 18:30 GMT.
On Friday, the US ISM Manufacturing PMI is scheduled to be published at 14:00 GMT.
XAU/USD short-term forecast
During the previous trading session, the XAU/USD exchange rate traded sideways in the 1,724 area. During Monday morning, the rate was trading at 1,722.00.
Note that yellow metal is squeezed by 55-, 100– and 200-hour moving averages, located near 1,724.00 and 1,710.00 respectively. Thus, gold could consolidate against the US Dollar in the short run.
On the other hand, it is likely that the rate could trade within a short-term ascending channel. Given that the rate is trading near the lower channel line, it is likely that some upside potential could prevail, and the price for gold could re-test the psychological level at 1,740.00.
Hourly Chart
On the daily candle chart one can observe that the round price levels have been forcing the rate into changing its direction. Take a look at the 1,750.00, 1,700.00 and 1,650.00 levels, as they provided both support and resistance.
In addition, Dukascopy Analytics have connected the high and low levels of the previous months, which has revealed a rising wedge pattern. In theory the support and resistance lines of the wedge could guide the rate to the 1,800.00 mark.
Meanwhile, historical high levels of the past decade have been marked on the daily candle chart.
Daily Candle
Traders became long on gold
On Monday, the Swiss Foreign Exchange sentiment was 75% long.