- SWFX traders remain bearish with 54% of open positions being short
- 60% of pending commands are to buy the bullion
- The metal's price opened the day's trading at 1,243.40
- Upcoming Events: US Existing Home Sales
It seems that the reversal of the direction of the bullion is about to occur. Various clues indicate that the turning point is close. First of all the metal has found a short term support, and it began to approach short term resistance levels. The testing of these levels will reveal, whether the expected reversal is occurring or not.
US homebuilding activity rose slowed unexpectedly last month, official figures revealed on Friday. The Commerce Department reported that housing starts fell 5.5% to a seasonally adjusted annual pace of 1.09M units, the lowest since September 2016, following the preceding month's downwardly revised pace of 1.16M and falling behind analysts' expectations for decline to 1.23M-unit pace. On an annual basis, homebuilding dropped 2.4%.
US Existing Home Sales
This Wednesday is set to be a quiet trading day, as there is only one mentioning worth data release scheduled during the day. However, the data is not likely going to cause an impact on the financial markets. Namely, the US Existing Home Sales data set will be published at 14:00 GMT.
Gold finds support
The Tuesday morning forecast fulfilled itself only on Wednesday morning, as the US Dollar attempted to score additional gains during the second half of Tuesday's trading. However, on Wednesday morning the bullion reached the resistance of the 55-hour SMA near the 1,247.50 mark. Day traders were and will be watching this level of significance. The reason for that is that it could force the metal to make another attempt to pass the support at 1,243.59 level. On the other hand, if the resistance of the SMA is broken, the commodity price might surge above the 1,250 mark, as the closest resistance is located at the descending 100-hour SMA just above the mentioned level.
Hourly Chart
On the daily chart it can be observed that the yellow metal's price has reached the lower trend line of the long term pattern. That is due to the pattern being drawn differently. However, the more notable information is the fact that the lower Bollinger band and the 200-day SMA have joined forces at the 1,239.30 mark. In addition, the 100-day SMA and the 50.00% Fibonacci retracement are located just below the 1,250 level. These are additional levels of significance, which are to be taken into account.Daily Chart
SWFX traders contradict others
SWFX traders remain bearish, as 54% of open positions are short on Wednesday. Meanwhile, 60% of trader set up orders are to buy the metal.
OANDA Gold traders have once more increased their bullish outlook, as open positions are 63.29% long on Wednesday, compared to 61.41% on Tuesday. Meanwhile, traders of SAXO have also continued the buying of the metal, as 61.02% of open positions are long. Previously 58.39% of the bank's traders were long.
Spreads (avg, pip) / Trading volume / Volatility
Market participants foresee the price of gold being above 1,300 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 1,310 in the second half of September. Generally, 38% of participants believe the price will be above 1,350 in ninety days. Meanwhile, an astonishing 27% are voting for tight range between the 1,300 and 1,350 levels.