- Share of long trades advanced further from 59% to 61%
- Main resistance is still located around 1,100
- Key short-term demand can be found just above 1,080
- Economic events to watch in the next 24 hours: Greek Industrial Production (Jun), FOMC Members Fisher and Lockhart Speak, Australian NAB Business Confidence (Jul)
Gold continued to trade close to its lowest level in more than five years on Monday, as strong Dollar supported by a solid US jobs market data suggests the Fed could hike interest rates as early as in September. US employment climbed at a solid pace last month and wages recovered after a surprise stall in the preceding month. American employers created 215,000 jobs in July, slightly less than the 225,000 economists had expected to see. Nevertheless, the June data was revised up to 231,000, according to the Department of Commerce report. At the same time, the jobless rate remained at the lowest level of 5.3%. Meanwhile, holdings of SPDR Gold Trust, the world's biggest gold-backed exchange-traded fund, declined further, hitting 21.47 million ounces on Friday, the lowest level since September 2008.
Meanwhile, Canada's employment growth was slightly better than predicted in July, with employers creating 6,600 jobs in the reported month, enough to offset the preceding month's losses of 6,400 positions. Economists, however, had expected a gain of 5,000. Yet, the nation's unemployment rate remained at 6.8% for the sixth consecutive month, while participation rate stood at 65.7%, Statistics Canada reported.
Upcoming fundamentals: FOMC's Lockhart to speak in Atlanta, journalist questions expected
President of the Federal Reserve Bank of Atlanta Dennis Lockhart will to speak at the Atlanta Press Club Newsmaker Luncheon on Monday. He is a voting member of the FOMC in 2015, while a possibility of a Fed rate hike in September is attracting additional attention to today's speech. Among core fundamental data releases in course of the next 24 hours, the business confidence index from Australia is due at 1:30 GMT tomorrow morning. The National Bank of Australia's survey of 350 businesses comprises an index, which tracks business conditions in the country. It stood at 10 points in June, while a reading above zero indicates improving conditions.
US data fails to shake up XAU/USD
Volatility of gold prices was one of the highest in six trading days on Friday, but daily changes were far smaller than some massive movements registered earlier in July. Moreover, neither bulls nor bears benefited from daily trading, which resulted in a standoff. With all technical studies pointing on flat development, it is quite likely that the bullion will decide to wait for another momentum and trade sideways for some time. Moreover, there are dense resistance and support clusters being created at 1,100 and 1,080, respectively.Daily chart
In the one-hour chart the bullion's no-change trading is more visible at the moment. The future scenario is biased in favour of bears, as they may receive some extra momentum from either the 200-hour SMA, currently at 1,090 or local highs around 1,100.
Hourly chart
SWFX sentiment is back above 60%
In the meantime, OANDA share of bulls stays at 62.20% of all current positions, while SAXO Bank traders are also firmly optimistic towards gold at the moment, as there are 67% of bullish trades opened by Monday morning.