- SWFX traders are 54% bullish
- 62% of pending commands are to buy the metal
- The bullion opened at 1,214.46
- Upcoming Events: ADP Non-Farm Payrolls Change
Economic activity in the US services sector rose unexpectedly last month, official figures showed on Friday. The Institute for Supply Management reported its Purchasing Managers' Index for the services sector climbed to 57.6 in February, while market analysts expected the Index remain unchanged from the prior month's reading of 56.5 during the reported period. Any reading above the 50-point level indicates activity expansion in the services sector. Furthermore, the Non-Manufacturing Business Activity Index came in at 63.6, the highest level since February 2011, up from the previous month's 60.3. Data also showed the New Orders Index increased to 61.2, the highest since August 2015, following January's 58.6. The ISM said 16 out of 18 industries reported growth last month, adding that the share of companies expressing a positive outlook for the future rose markedly last month despite the existing uncertainty in the US economy. Economic activity contracted in the information industry and the real estate, rental and leasing industry in February.
After the release, the US Dollar hit its intraday high of 114.54 against the Japanese Yen but failed to maintain its gains as investors awaited a speech by the Fed Chair Janet Yellen in the day
Upcoming events: ADP Non-Farm Employment Change
During Wednesday's trading session there is one notable data release scheduled to occur. That would be the ADP Non-Farm Employment Change at 13:15 GMT. It will be covered on the live webinar by the Dukascopy research team, and the coverage is set to begin 20 minutes before the release, which is at 12:55 GMT.
Gold drops below 1,220 mark
Daily chart: The yellow metal has dropped below the 1,220 mark. In particular, the commodity price managed to decline as low as 1,213.92, where the bullion's price rebounded and began a surge, which occurred during the early hours of Wednesday's trading session. It is most likely that the decline of the bullion will continue in the near future, as the commodity price is facing the resistance put up by the weekly S1 at 1,216.60 and the 38.20% Fibonacci retracement level at the 1,219.20 level. The next level to decline to is the cluster of support, which surrounds the 1,208.96 level, where the monthly S1 is at.Daily chart
Hourly chart: The bullion's price continues its path lower in the descending channel pattern. However, it is highly unlikely that its borders will influence the rate notably during the day. A larger role is being played by the 20-day SMA, which is located in the middle of the pattern. Recently the commodity price bounced above the weekly S1, which is located at 1,216.60 level. Although, the surge did not continue, as the yellow metal's efforts were stopped by the simple moving average, which seems to be strong enough to push the price lower.
Hourly chart
Trader opinion remains firm
OANDA Gold traders have increased their bullish outlook, as open positions are 67.09% long on Wednesday, compared to 65.14% previously. In addition, traders of SAXO bank have done the same, as 68.81% of open positions are long, compared to 67.24% on Tuesday.