On Thursday, the yellow metal's price was being pushed down by the 55-hour simple moving average.
During the push down the support cluster at 1,274.00 was pierced. This event signalled that the decline of the commodity price could continue.
This week's data releases will end on Thursday.
At 08:30 GMT, the UK Retail Sales will be published.
Afterwards, the Canadian and US Retail Sales will be published at 12:30 GMT. Both data sets combined could cause a move on the USD/CAD of up to 30 pips.
Note that the US data is set to influence all USD currency exchange rates.
Meanwhile, check out previous data release covers and economic calendar analysis on the Dukascopy Webinars YouTube channel.
XAU/USD short term forecast
The short term forecast of the hourly chart is concentrated on the 55-hour SMA.
If the simple moving average pushed the rate properly through the support levels near 1,274.00, the commodity price is expected to have no technical support as low as 1,255.80.
On the other hand the commodity price has experienced a very sharp and large drop. In theory a consolidation by trading sideways or up should take place.
Hourly Chart
On the daily chart the exchange rate has no technical support as low as the 200-day simple moving average near 1,250.00Previously the commodity price reached below the 100-day SMA.
Daily Chart
Short sentiment increases
Traders continue to short gold. Since Monday, on the Swiss Foreign Exchange 61% of the total open position volume was in short positions.
On Wednesday, the sentiment increased, as 64% of open position volume was short. The proportion remained unchanged on Thursday.
Meanwhile, the trader set up pending orders in a 1000 base point range around the metal's current price reveal additional information.
Trader pending orders in that range were set to buy in 58% of cases.
By the middle of Wednesday's trading session the orders were neutral, as 52% of pending orders were to sell.