The lower than expected US inflation caused a drop of the US Dollar. The price for gold surged and hit the 1,825.00 level due to the event. However, a decline and looking for support in the 1,803.30/1,809.90 range followed. At mid-day on Wednesday, the rate was located near the 1,805.00 level. Economic Calendar Analysis
On Wednesday, the top event of them all will take place. At 19:00 GMT, the US Federal Reserve will release its Federal Open Market Committee Statement and Economic Projections. The central bank is expected to hike its base interest rate from 4.00% up to 4.50%.
On Thursday, at 13:30 GMT, the US Retails Sales data and Empire State Manufacturing Index might cause an adjustment in the value of the US Dollar.
The week will end with the publication of Markit Services and Manufacturing sector Purchasing Managers Index survey data at 14:45 GMT.
XAU/USD short-term forecast
In regards to near future, fundamentals continue to dictate the moves. At 19:00 GMT, the US Federal Reserve is set to announce its interest rate hike. The markets expect a 0.50% interest increase. Afterwards, at 19:30 GMT, the head of the Federal Reserve Jerome Powell will host a press conference, during which the future plans of the US Dollar's policymakers will be revealed.
Hourly ChartXAU/USD daily charts review
On the daily candle chart, the metal has pierced the 1,787.05/1,808.15 resistance zone. The zone held the price down since mid-November. Higher above, note the June high of 1,880.00. However, other round price levels acted as support and resistance throughout May and June.Daily Candle Chart
Long sentiment decreases
On Monday, the open positions were 61% long and orders were 68% to sell.
On Tuesday, the sentiment on the Swiss Foreign Exchange was 59% bullish. Namely, 59% of open position volume was in long positions.
Meanwhile, in the 1000-pip range around the metal's price, pending trade orders were 64% to sell the precious metal.
By mid-Wednesday, only 54% of volume was long. Traders have cut their long positions and taken profits.
Meanwhile, orders were 89% to buy. Namely, traders were ready to reopen their long positions, if the Federal Reserve is taking the easing path in their monetary policy.