- Opened positions for Gold are positive (67% bullish / 33% bearish)
- It is possible that Gold will grow in price, with the closest resistance for it located at 1,192
- At the same time, the probability of a downside movement exists as well, while for that purpose the closest support is placed at 1,180
- Upcoming events: China Manufacturing PMI, US Unemployment Claims, Pending Homes Sales and Crude Oil Inventories
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The US Dollar hovered around the highest level in nine years versus a basket of major currencies, sapping gold's lure as a hedge. The Greenback stayed close to the 29-month peak against the single currency as Greek Prime Minister Antonis Samaras called snap general elections following unsuccessful attempt to elect a president. On top of that, shares rose in major markets on Monday, hurting the yellow metal, while crude oil prices dropped following a short-lived rebound.
Concerning the core fundamental part, US durable goods orders unexpectedly slumped in November, largely owing to a weak demand for military and defense goods. The Commerce Department said that orders for long-lasting goods declined 0.7% last month, the third drop in the past four months. Much of the decrease was attributed to a sharp 8.1% fall in demand for defense-related goods. Excluding volatile transportation equipment, bookings slid 0.4%.
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US and China statistics to drive Gold during New Year's Eve
Even though trading volumes are at very low levels during Christmas and New Year holidays, some statistics is still scheduled to be published and is likely to have influence on the price of Gold. Tomorrow, the most important data is considered to be the weekly jobless claims, which will be followed by pending home sales for November and crude oil inventories in the US for the week ended December 28. Alongside, the Chicago PMI will show activity in different industries of this city's region, while in the evening of December 31 the Chinese Federation of Logistics and Purchasing will release a very important manufacturing PMI for the country in December.Read More: Fundamental Analysis
XAU/USD returns back below down-trend
The XAU/USD cross has breached the most important resistance line, represented by the long-term downtrend and developed above this level for the past week. However, on December 15 Gold returned back, mostly amid fundamental factors. At the moment the most considerable resistance is represented by this long-term downtrend line, which is currently located at $1,205 and strengthened by the monthly and weekly R1.Daily chart
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Gold undertook a correction period during the first day of New Year's week. XAU/USD was unable to consolidate above the 23.6% Fibo retracement, which is also reinforced by the 20-day SMA and weekly pivot point around $1,192. As a result, the cross fell below this important line. At the same time, a confident support was provided by the 2013 low and weekly S1 $1,180. Despite that, judging from technical indicators, Gold is likely to decline both in short and medium-term, and we tend to believe them.
Hourly chart
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Read More: Technical Analysis
Long opened positions decreased further to 67%
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Nov 30 and Dec 30 expect, on average, to see Gold trading around 1,200 by the mid-March. At the same time, 48% of them believe the bullion will be above this mark in three months, while slightly less than one third of traders surveyed forecast the bullion to trade in the range between 1,050 and 1,200.
© Dukascopy Bank SA