- SWFX traders remain bearish with 53% of open positions being short
- 53% of pending commands are to buy the bullion
- The metal's price opened the day's trading at 1,266.80
- Upcoming Events: US CPI and Retail Sales, US Federal Funds Rate
On Wednesday morning the bullion started to trade in range between the weekly PP from the top and 55-period SMA from the bottom. Most likely the pair is going to try the reach the 61.80% Fibonacci retracement level at the 1,278.96 mark.
US producer prices held steady last month amid low energy prices. The Labour Department reported on Tuesday that its Producer Price Index came in at 0.0% in May, following the preceding month's climb of 0.5% but meeting analysts' expectations. On an annual basis, the headline PPI rose 2.4%, compared to April's 2.5% jump, which was the largest yearly rise since February 2012. In the meantime, the so-called core PPI climbed 0.3% last month, following April's rise of 0.4%, whereas analysts expected core producer prices to increase 0.2%.
Set of US macroeconomic and monetary data release
In terms of macroeconomic data, today will be marked with a release of data on the US CPI and Retail Sales. Both data sets will be covered by the Dukascopy Research Team at 12:30 GMT. The coverage webinar is set to begin at 12:00 GMT. In the second half of the day any fundamental data release impact will be wiped out by the information coming out from the FOMC. The FOMC is set to announce their rate decision and publish their meeting protocols and economic outlook at 18:00 GMT.
Gold finds support
It cannot be seen on the hourly chart. However, the yellow metal has found support at the 1,260 mark. The successful rebound has evolved into a surge up to the 1,270 level on Wednesday morning. The surge might be at its end, as the 100-hour SMA is closing in on the commodity price from the upside at the 1,271.90 level. However, the 55-hour simple moving average did not manage to hold the ascent of the bullion's price. Instead it quickly began to provide support. This fact strengthens the hypothesis that by the end of the day gold price might reach the next notable level of resistance. The next notable resistance is located at the 1,276 level, where the weekly pivot point and the 200-hour simple moving average are located at.
Hourly Chart
The daily chart reveals that the currency pair resumed the surged after series of bullion's depreciation. During the last two trading days the 55-period SMA at 1,260.81 was providing support for the yellow metal. For the moment, the pair is trading around the 20-period SMA at 1,268.30 and is heading towards the combined resistance level set up by the weekly PP at 1,276.01 and 61.80% Fibonacci retracement level at 1,278.96.Daily Chart
Markets remain practically neutral
SWFX trader sentiment has not changed during the first half of this trading week. Traders are clearly bearish, as 53% of open positions are short on Wednesday. Meanwhile, 53% of trader set up orders are to buy the metal.
OANDA Gold traders remain bullish, as open positions are 57.09% long on Wednesday, compared to 55.02% yesterday. Meanwhile, traders of SAXO bank have become neutral, as 50.57% of open positions are long.
Spreads (avg, pip) / Trading volume / Volatility
Market participants foresee the price of gold being slightly below 1,350 in three months
Traders who were asked regarding their longer-term views on gold during the last month expect, on average, to see the metal around 1,340 in September. Generally, 36% (-1%) of participants believe the price will be above 1,350 in ninety days. Meanwhile, an astonishing 33% are voting for tight range between the 1,300 and 1,350 marks.