- Opened positions on Gold remain strongly positive (75% bullish / 25% bearish)
- The closest resistance for the yellow metal is currently located at 1,201
- At the same time, the closest support for the bullion is placed at 1,197
- Upcoming events on April 20: Germany PPI (Mar), Bundesbank Monthly Report, New Zealand CPI (Q1), UK Rightmove House Price Index (Apr)
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Gold steadied around $1,200 an ounce on Friday, but was poised for the second consecutive weekly decline due to increasing speculation over the timing of the US interest rate hike. Even though the world's largest economy posted worse than expected data on building permits, housing starts and unemployment claims, raising concerns about the economy's ability to rebound from a weak patch hit in the beginning of the year, there are expectations growth will bounce back in the second quarter. Yet, the lukewarm fundamentals indicate the momentum is unlikely to be strong enough for the Fed to start raising interest rates before September.
Australia's unemployment rate unexpectedly dipped, as the economy added a surprisingly strong number of jobs. The jobless rate declined to 6.1% in March, compared with a revised 6.2% in the preceding month, according to the Australian Bureau of Statistics. Economists, in contrast, had called for an increase to 6.3%.
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New Zealand inflation, UK HPI to be released on Sunday-Monday
In the night between Sunday and Monday, several important indicators are going to be announced in New Zealand and Britain, which may weigh on performance of Gold when the market reopens the next week. In the South Pacific country, analysts are waiting for first quarter inflation data, while later the UK Rightmove will announce the housing price index in the country for April of this year.Read More: Fundamental Analysis
XAU/USD develops inside bearish wedge pattern on daily chart
Since the second quarter of 2013, the bullion has been developing inside the falling wedge pattern, meaning that trading range is decreasing as time goes on. In March 2014, however, the yellow metal resumed gaining value, even without touching the lower trend-line which is currently located around 1,100. Therefore, towards the end of April the bullion is likely to approach the upper boundary of this pattern just below 1,280 where bears are forecasted to overtake a lead and drive the metal back to the south. The overall negative trend for Gold seems also inevitable in the long-term future, while at the end of this year the precious metal is likely to consolidate around 1,150, in case the present trend persists.Daily chart
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It seems that Gold returned into the narrow range between two important technical levels, the 20 and 55-day SMAs. Yesterday, XAU/USD cross attempted to escape these boundaries and even climbed above weekly PP at 1,207. However, bullish impetus used to be weak enough to push the bullion considerably to the north and the price closed at 1,197 by the end of the day. As a result, Gold is likely to remain under 55-day SMA's pressure in the nearest future, thus our outlook remains bearish with a target at monthly PP (1,183) the next week.
Hourly chart
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Read More: Technical Analysis
SWFX opened positions on Gold remain strongly positive
Meanwhile, OANDA's bulls continue to enjoy a firm majority as their share of total opened positions stays at 63.20% at the moment, and Gold's sentiment there is currently the fifth most positive among all major currency pairs. Saxo Bank market participants, in turn, are also confident with respect to the precious metal, as there are 61% of bullish positions registered by 5:30am GMT on April 17, an upward return of percentage points on a basis of past 24 hours.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Mar 17 and Apr 17 expect, on average, to see Gold trading around 1,250 by the end of July. At the same time, 58% of them believe the bullion will be strongly above this mark in three months, while 28% of traders surveyed forecast the bullion to trade in the range between 1,100 and 1,250.
© Dukascopy Bank SA