As expected, the yellow metal's price reached the March high level of 1,740.00. The historical high level provided resistance, which resulted in a decline to the 1,721.50 level. This level provided support to the price.
On Friday, the rate traded sideways between 1,721.50 and 1,735.00.
This Friday, a notable reaction of above then pips could be created by the US Durable Goods orders.
During the next week the US Advance GDP on Wednesday at 12:30 GMT. This is the first of three types of US quarterly GDPs. The Advance release reveals the first Gross Domestic Product numbers of a quarter. The following Preliminary and Final GDPs usually reveal slight adjustments. In general, the data will reveal the first impact of the coronavirus on the US economy.
Afterwards, at 18:00 GMT, the Federal Reserve is bound to make a rate statement, which is bound to react to the ongoing economic decline. Take into account that the Federal Reserve Rate announcement and FOMC Statement are set to be followed by a Press Conference at 18:30 GMT.
On Friday, the US ISM Manufacturing PMI is scheduled to be published at 14:00 GMT.
XAU/USD short-term forecast
In regards to the near term future, the metal's price was expected to trade sideways until it is approached by the hourly simple moving averages. The SMAs are expected to push the rate into another test of the 1,740.00 level.
If the 1,740.00 fails to hold, the rate could reach for the resistance of the 1,750.00 mark. On the other hand, the rate might pass the support of the SMAs and reach back down to the 1,700.00 mark.
Hourly Chart
On the daily candle chart one can observe that the round price levels have been forcing the rate into changing its direction. Take a look at the 1,750.00, 1,700.00 and 1,650.00 levels, as they provided both support and resistance.
In addition, Dukascopy Analytics have connected the high and low levels of the previous months, which has revealed a rising wedge pattern. In theory the support and resistance lines of the wedge could guide the rate to the 1,800.00 mark.
Meanwhile, historical high levels of the past decade have been marked on the daily candle chart.
Daily Candle
Sentiment remains unchanged
Since Tuesday, the Swiss Foreign Exchange sentiment was 54% short. Namely, 54% of open gold position volume was in short positions.
On Thursday, the sentiment slightly decreased, as 53% of volume was short. However, it returned back to being 54% short on Friday.
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