The Friday's forecast was correct, the rate surged up to the 100-hour simple moving average, which pushed the commodity price down.
On Tuesday, the gold price had reached below all of the support levels near the 1,273.00 level. This fact indicated that the price could continue its decline.
During this week there will be a couple of macroeconomic events to watch, avoid or trade.
First, the Canadian central bank will publish their interest rate on Wednesday at 14:00 GMT.
On Thursday, the US Durable Goods Orders data will be published at 12:30 GMT. This event can cause a move of up to 20 base points.
The data will end on Friday, as at 12:30 GMT the US Advance GDP will be published. This is the top US data set, which has the largest impact on the USD.
Meanwhile, check out previous data release covers and economic calendar analysis on the Dukascopy Webinars YouTube channel.
XAU/USD short term forecast
At the beginning of current week, the XAU/USD exchange rate traded between the 55– and 100-hour SMAs.
From a theoretical perspective, the rate should reverse north from the lower boundary of the falling wedge pattern. However, the price for gold has to surpass the given moving averages.
If the given resistance and pattern hold, it is likely, that the rate could trade sideways around the Fibonacci 38.20% retracement at 1,273.68. If the given pattern does not hold, it is expected, that a breakout south occurs in the short run.
Hourly Chart
On the daily chart the exchange rate has no technical support as low as the 200-day simple moving average near 1,250.00Previously the commodity price reached below the 100-day SMA.
Daily Chart
Traders short gold
On the Swiss Foreign Exchange 62% of open position volume was in short positions.
Meanwhile, the trader set up pending orders in a 1000 base point range around the metal's current price reveal additional information.
Trader pending orders in that range were balanced. 50% were set to buy and 50% were set to sell.