The yellow metal failed to pass the resistance of the 1,815.00 level on Thursday. The commodity price retreated and on Friday found support in the 100-hour simple moving average at 1,795.90.
This event resulted in a surge, which was set to result in another test of the mentioned 1,815.00 resistance level.
Economic Calendar Analysis
On Friday, the US Producer Price Index and US Core Producer Price Index are set to be released. In the recent past they have not caused notable volatility.
Next week, data releases are scheduled to start on Tuesday. The US CPI data sets have not caused notable moves. Normal volatility remains intact during the announcement.
On Thursday, there will be the publication of the US Retail Sales and Unemployment Claims at 12:30 GMT.
For more information read the weekly event review article by clicking on the link below.
XAU/USD short-term forecast
Yesterday, the XAU/USD exchange rate declined to the support provided by the 100-hour SMA near 1,795.00. During Friday morning, the rate reversed north.
It is likely that yellow metal could gain support from the 55-hour moving average near 1,805.00 and extend gains in the short term. Note that the nearest resistance level—the monthly R1, is located at 1,821.43.
However, if the exchange rate fails to exceed the psychological level at 1,815.00, it is likely that gold could trade sideways against the US Dollar in the nearest future.
Hourly Chart
On the daily candle chart, the metal has passed the trend line that was drawn by connecting the 2019 and 2020 high levels. Take into account that the resistance line is drawn by not using the actual high levels, but the closing and open prices of the daily candle charts.
Due to that reason, another trend line of the absolute highs has been added. The zone between the two lines can be seen as a resistance zone.
Daily Candle Chart
Traders are short
On Friday, on the Swiss Foreign Exchange the sentiment was bearish, as of total open position volume 62% was short.
Meanwhile, in the 1000-pip range around the current metal's price the orders were 61% to buy.
Previously, the orders were 67% to buy.