Gold reacts to fundamentals

Source: Dukascopy Bank SA
On Thursday, the US Dollar strengthened due to better than expected US Unemployment Claims and ADP Non-Farm Employment data. This resulted in a decline of the price of gold down to the support of the 1,825.00 level. The support was enough to cause a recovery up to the 1,840.00 level.

Economic Calendar Analysis



On Friday, The United States employment data release at 13:30 GMT is highly likely going to impact the US Dollar. Later on, at 15:00 GMT the ISM Services PMI is set to cause minor impact on the financial markets.

XAU/USD short-term forecast

A move above 1,840.00 is expected to test the resistance of the 1,850.00 level and the 50-day simple moving average. Higher above, the 1,865.00 is expected to once again act as resistance.

However, a decline of the commodity price is expected to find minor support in the December high level at 1,833.20 and the 1,830.00 level, prior to once again looking for support in the 1,825.00 level.

Hourly Chart

XAU/USD daily charts review

On the daily candle chart, the metal has pierced the 1,787.05/1,808.15 resistance zone. The zone held the price down since mid-November. Higher above, note the June high of 1,880.00. However, other round price levels acted as support and resistance throughout May and June.

Daily Candle Chart


Traders are neutral

On Friday, traders were neutral on gold, as 50% of open positions were long and short. The sentiment had been neutral since Monday.

Meanwhile, pending orders in the 1000-pip range were 59% to sell.

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