- 58% of all SWFX open positions are long
- Trader pending commands are set up to buy the metal, namely 60% of total orders
- Gold opened Wednesday's session at 1,187.11
- Economic events to watch over the next 24 hours: ECB President Draghi Speaks; US ADP Non-Farm Employment Change; US Core PCE Price Index; US Personal Income; US Personal Spending; US Chicago PMI; US Pending Home Sales; FOMC Member Powell Speaks; OPEC meeting
New orders for US manufactured durable goods rose markedly last month, driven by higher demand for machinery and other equipment, official figures revealed on Wednesday. Overall, new orders for capital goods jumped 4.8% in October, according to the US Department of Commerce. Meanwhile, market analysts anticipated a slight acceleration to 1.2%. The September figure was revised down from -0.1% to -0.3%. Demand for transportation equipment jumped 12% during the reported month, the largest gain since October 2015. Back in September, new orders for transportation equipment climbed 0.4%. Excluding orders tied to transportation, core durable goods orders increased 1.0%, following September's downwardly revised gain of 0.1% and surpassing the 0.2% rise market forecast. The US economy is set to expand at a 3.6% annual pace in the Q3, after growing 2.9% in the previous quarter. Separately, the Department of Labor reported on Wednesday the number of Americans filing for unemployment benefits increased to 251,000 in the week ending November 18, up from the prior week's 233,000, whereas analysts expected a milder rise to 241,000.
On Monday 21 of November ECB President Mario Draghi, during his speech has urged the European Union to stay united in the face of different challenges such as Brexit as he warned that the cohesion of Europe is being tested. Speaking in the European Parliament in Strasbourg, Mr. Draghi noted that "The euro area recovery continues to proceed at a moderate, but steady, pace. It has shown remarkable resilience to adverse developments and uncertainties emanating from the global environment." said that Europe needs to respond "cohesively and decisively" to the current challenges facing Europe. Overall, Mr. Draghi maintained a neutral tone and he is not prepared at this stage to offer strong hints over the likely policy action at December's policy meeting. There were also no attempts to steamroller the ECB Council into policy action. The stated above comments will maintain expectations that the ECB is not planning to announce some form of bond-buying extension, although the details are still in discussion. In the meantime, reaction to the speech was limited as markets remained in a consolidation phase with EUR/USD finding support just below the 1.0600 level.
Upcoming fundamentals: End of the month data releases and OPEC meeting
The yellow metal could be affected by various factors on Wednesday, as not only it is the end of the month and various US data releases are set to affect the markets, but also an OPEC meeting is taking place. Regarding the notable US data, traders should look at the US ADP Non-Farm Employment Change data at 13:15 GMT, as it is the first indicator, which reveals the situation in the US labor market. Moreover, crude oil inventories at 15:30 GMT might affect the commodity price. However, the Dukascopy team would like to remind market participants that one word from Donald Trump can reset the whole situation, so US politics are still on the agenda.
Gold trades below weekly PP
Daily chart: On Wednesday morning the yellow metal traded below the weekly pivot point, which is located at 1,191.86. The bullion began the day by continuing an attempt to break through the resistance put up by the weekly PP. However, it seems highly unlikely that it will manage to score notable gains during today's session, as the general downward trend still persists. It is most likely that the bullion will remain flat by the end of the day, as it is being squeezed in by trend lines from both sides. Such a hypothesis is also confirmed by the calculated daily aggregate technical indicators.Daily chart
Hourly chart: The hourly chart for gold reveals that the metal fell below the weekly PP around 8:00 GMT, when it stopped bouncing around the level of significance and fell below the 100-hour SMA. The fall continued until the commodity price reached the 1,180 level at 13:00 GMT, when the metal rebounded due to changes in US Dollar's fundamentals. In the aftermath of that the bullion once more jumped to the weekly PP, shortly traded above it and most recently began to retreat once more.
Hourly chart
SWFX trader sentiment stagnates
OANDA open long positions have almost not changed and are at 75.78%, compared to 75.61% on Tuesday. In addition, SAXO bank traders have almost done the same, as on Wednesday 64.33% of traders bet the metal will surge, compared to 63.34% during the previous session.