The yellow metal's price found support in the 1,680.00 level before starting a recovery. At mid-day on Tuesday, the commodity price passed the resistance of the 100-hour simple moving average near the 1,700.00 mark.
Due to that reason, the metal had no technical resistance as high as the 200-hour simple moving average at 1,727.45.
On Wednesday, the US Consumer Price Index data could cause a minor move on USD assets at 13:30 GMT.
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XAU/USD short-term forecast
After finding support in the 1,675.00 level on Monday, the price of the yellow metal began a surge. By the middle of Tuesday's GMT trading hours, the price had reached above the 100-hour simple moving average, which had previously stopped an attempt to recover.
In the near term future, the price should aim at the resistance of the 200-hour SMA and 38.20% Fibonacci retracement level near 1,730.00. If this level would be passed, the metal could test the upper trend line of the channel down pattern.
On the other hand, the rate could face resistance at round price levels like the 1,710.00 and 1,720.00. Both of these levels have shown in the past that they can impact the commodity price.
Hourly Chart
On the daily candle chart, the metal pierced the support of the 61.80% Fibonacci retracement level at 1,690.05. Due to that reason, it was no longer expected to impact the price.
In the meantime, the June low level of 1,672.39 has been marked on the chart. This level could provide support.
Daily Candle Chart
Traders are long on gold
On Tuesday, the sentiment on the Swiss Foreign Exchange was bullish, as 72% of open position volume was long.
Monday, 75% of volume was long. Note that the gold sentiment is largely bullish at all times due to long term holders.
Meanwhile, in the 1000-pip range around the metal's price the pending orders were 62% to sell the metal.