In the near term future, the commodity price will reveal its direction after the Thursday's US CPI release. As the Dollar picks a direction, so should the price of gold. Economic Calendar Analysis
On Thursday, the top event of the week will take place. At 12:30 GMT, the US Consumer Price Index is bound to impact all currency pairs via an adjustment of the value of the US Dollar to the inflation numbers.
On Friday, the US Producer Price Index numbers will reveal how inflation is doing at the producer level. This rate might cause a move, if it deviates a lot from the market forecast. However, due to it being released a day after the consumer inflation, it is unlikely that the PPI numbers create a major market reaction.
XAU/USD short-term forecast
If the metal declines below the 2,590.00/2,600.00 range, the 2,570.00 and 2,560.00 levels could act as support, before the 2,650.00 mark is reaches.
However, in the case of a potential surge of the price, the metal would have to break the combined resistance of the 2,625.00 level and the 50-hour simple moving average. Higher above, note the 2,640.00 level and the 100 and 200-hour simple moving averages.
XAU/USD daily charts review
On the daily candle chart, the metal is consolidating after a big surge. The metal could find support in the 2,600.00 and 2,550.00 levels and the ascending 50-day simple moving average. In addition, note the lower trend line of the channel up pattern.Daily Candle Chart
Traders remain short
On Wednesday, 63% of volume was in short positions.
Meanwhile, in the 1000 point range around the latest price, the pending orders were 62% to sell the metal.
On Monday, traders were 66% short. At the same time, the pending orders were 56% to sell.