- SWFX traders are 54% bearish
- 59% of pending orders in 800-pip range are set to SELL
- Combined support at 1,329.68
- Upcoming Events: Empty day
Last Friday the exchange rate made an expected rebound from the upper resistance line of a medium rising wedge and left the pattern. For this reason, the pair is expected to continue its road to the south. However, this scenario might be postponed due to presence of a strong support that consists of the 200-hour SMA and updated weekly S1 at 1,329.68
EUR/USD revealed muted reaction on the ECB rate announcement ahead of the Central Bank's policy statement. . However, the first half an hour of the Mario Draghi speech put the European single currency 72 pips higher against the US dollar, while the further course of press conference managed to keep the Euro above the 1.2000 level. The ECB President Mario Draghi noted that volatility in the Euro exchange rate was a source of unclarity, causing the necessity to monitor the FX rate impact on price stability being very important for inflation targets and growth. Mr. Draghi stated that underlying inflation trends had improved, but continued to be relatively subdued, while confidence surrounding the future economic growth remained strong.
Empty day
Today economic calendar does not contain any fundamental data releases at all.
XAU/USD falls below 1,340.60
The way the exchange rate started new trading week confirmed that previously it was moving in a medium-term rising wedge. Generally, the pair is expected to gradually move to the bottom, trying to reach the lower trend-line of a senior ascending channel. However, in order to do that the rate will have to cross a combined support level formed by the updated weekly S1 at 1,329.68 and the 200-hour SMA. Even though it sounds like a too strong barrier, the path to the north is also well secured. Namely, it consists of the 55- and 100-hour SMAs as well as the weekly PP at 1,343.70. By the way, the bearish scenario is also confirmed on a daily scale, as last Friday the gold made a rebound from an upper trend-line of a long-term ascending channel.
Hourly Chart
In accordance with the pattern theory perspective, the gold made a rebound from a resistance line of long-term ascending channel (or medium rising wedge) and started to move in the opposite direction. From this perspective, now the price of yellow metal should be driven by bears, who will try to drag it at least until the 61.80% Fibonacci retracement level at 1,278.96Daily Chart
Markets sentiment remains bearish
Traders of Dukascopy remain bearish on the price of gold, as 54% of open positions are short. Accordingly, 46% of pending commands is to buy the commodity. Moreover, 40% of pending orders are set to sell the buck.
OANDA Gold traders remain neutral, as open positions are 51% bullish. In the meantime, SAXO bank traders are also neutrally bullish, as 51% of open positions are short.