On Tuesday, as risk on sentiment returned to the markets, gold's price passed the support of an ascending channel pattern. In addition, the support of the hourly simple moving averages had been passed.
Both of these factors signaled that a decline of the commodity price could be expected.
Economic Calendar Analysis
Note that on Wednesday, at 13:15 GMT the ADP Non-Farm Employment Change is scheduled to be published. However, with an exception in December, the event has not caused an increase of volatility on USD pairs.
As each week, the US Crude Oil Inventories will be released. This week, the data will be out on Wednesday at 15:30 GMT.
Last but not least, on Friday, at 13:30 GMT both Canada and US will release their employment data. The release will consist of two numbers from Canada and three from the US.
The week's event historical data tables have been published. Click on the headline below to read the article.
XAU/USD short-term forecast
In theory, the commodity price should decline, as it has left above it the hourly simple moving averages and has broken the channel up pattern. However, expect that round price levels could still provide support.
In the meantime, the most close by technical support level was a pivot point at the 1,534.44 level.
Hourly Chart
The broken pattern can be better observed on the daily candle chart.
Meanwhile, take into account that the metal is overbought, as indicated by daily simple moving averages, which are located near the 1,500.00 level.
Daily Chart
Swiss traders remain short on gold
Since Thursday, the Swiss Foreign Exchange gold sentiment was 55% short. Namely, 55% of open gold position volume was in short positions and 45% was in long positions.
Meanwhile, in the 1000 base point range around the current metal's price the pending orders were mostly bullish– 72% of orders were to buy and 28% to sell.
The orders were 71% to buy on Monday.