The yellow metal declined on Thursday, as risk on sentiment returned in the markets. By the middle of the day's London trading hours, the rate had reached the support of a pivot point at 1,544.31.
In addition, an attempt to pass the pivot point was stopped by the technical support of the 200-hour simple moving average at 1,541.00. Economic Calendar Analysis
The week will end with the three US employment data sets being published at 13:30 GMT.
Meanwhile, next week's scheduled event historical data tables have been published. Click on the link below to read the article.
XAU/USD short-term forecast
During Wednesday, the XAU/USD exchange rate traded downwards. During today's morning, the rate tested the support formed by the monthly R1 and the 200-hour SMA at 1,544.31.
If the given support holds, it is likely that a reversal north could occur in the nearest future. Note that the rate would have to surpass the resistance formed by the 55– and 100-hour SMAs, as well the monthly R2 in the 1,570.00 area.
If the given resistance and support levels hold, it is likely that yellow metal could trade sideways against the US Dollar in the short term. However, if the given support does not hold, it is likely that the price for gold could decline below 1,530.00.
Hourly Chart
For a time being, it appeared on the daily candle chart that a retracement down should occur due to the metal being overbought. The retracement started on Wednesday.
In general, on the daily candle chart the pair has no technical support as low as the 55 and 100-day simple moving averages that are located near the 1,500.00 level. If the support levels of the hourly chart fail, eventually the price could reach for the support of the SMAs.
Daily Chart
Traders stick to short positions
On Wednesday, on the Swiss Foreign Exchange 56% of open gold position volume was in short positions. By the middle of Thursday's trading, the sentiment was 57% short.
The sentiment was short before the latest surge. It can be assumed that these short positions have broken even during the decline.
Meanwhile, in the 1000 base point range around the current metal's price the pending orders were to sell – 69% of orders were to sell and 31% to buy.
Previously, the orders were 77% to buy.