Gold attempts to retake July low at 1,070

Disappointing statistics on Chicago PMI and US pending home sales dragged American equity markets lower on Monday, which consequently supported the safe-haven commodity. Gold was pushed above the weekly pivot point at 1,063 yesterday, and today's rally is already being extended above July low of 1,070. Closure above the latter will change our expectations back from negative to neutral. Extra gains can be prolonged up to 20-day SMA/monthly PP at 1,084/86. However, the long term estimate keeps bearish bias, as we are approaching the critical Fed meeting on Dec 16.

At the moment around 70.26% of SWFX traders are holding long positions, a decrease of three percentage points' on a daily basis. This distribution reveals that gold is too overbought and long term risks are skewed to the downside.