- SWFX traders are 56% bearish
- 58% of pending orders are set to buy the Dollar
- Significant support near 1,318.00 – 1,321.00
- Upcoming Events: US CPI, Unemployment Claims
Due to release of data on the US PPI, the buck appreciated quite sharply against the bullion. Fortunately, the downfall was stopped at the lower support line of a long-term ascending channel. From this point of view, the gold has to start to gradually recover, trying to reach at least the weekly S1 at 1,329.68. But this scenario might be altered because of the release of the US CPI.
The Labour Department revealed that the US producer prices accelerated growth at the strongest pace in four months amid an increase in gasoline prices. The report showed that the country's PPI for final demand rose 0.2% in August, slightly below expectations for a 0.3% increase. Wednesday's data were not quite as strong as the Fed would like to consider to support an increase in core consumer prices to the Banks 2% target.
The Labour Department released its JOLTS report for July, where the amount of job openings rose surprisingly to 6.17M, following a downwardly revised figure of 6.12M in June. Data showed that slower job growth was temporary, while a new record high for the number of job openings indicated that demand for workers continued to be strong. Moreover, the labour market kept tightening due to a lack of skilled labour supply, though remained in a healthy growth state.
US CPI in focus
Dukascopy Research Team welcomes everyone to join our live discussion on release of information about the US CPI and Unemplyoyment Claims at 12:20 GMT. The data release, as usually, is expected to cause notable but short term volatility in the markets.
XAU/USD rebounds from bottom edge of ascending channel
A release of update on the US PPI led to 0.97% appreciation of the buck against the yellow metal. Fortunately, this time an effect from the above fundamental event matched with the technical analysis, which also pointed out on the further downfall of the rate. However, after reaching the lower trend-line of a long-term ascending channel the pair made a rebound.
From a larger perspective, this turn around means that the gold once again has to start gaining value and try to soar towards the monthly R2, which is located at the 1,374.50 level. From a short-term perspective, the surge is likely to be neutralized by a combination of the 100- and 200-hour SMAs.
In addition to that, there is a need to take into account an effect from release of data on the US CPI and Core Retail Sales, which can alter the above scenario.
Hourly Chart
As it was expected, the pair did stay for long at the weekly S1 and continued its path to the south with an ultimate goal to reach the 61.80% Fibonacci retracement level at 1,279.28.Daily Chart
Markets sentiment remains bearish
Traders of Dukascopy remain bearish on the price of gold, as 56% of open positions are short. Accordingly, 56% of pending commands are to buy the commodity.
OANDA Gold traders remain neutral, as open positions are 50% bearish. In the meantime, SAXO bank traders are neutrally bearish, as 51% of open positions are long.