- Opened positions on Gold remain positive (68% bullish / 32% bearish)
- The closest resistance for the yellow metal is currently located at 1,173
- At the same time, the closest support for the bullion is placed at 1,146
- Upcoming events on March 14-16: Germany Bundesbank Monthly Report, US Industrial Production (Feb), China Foreign Direct Investment (Feb), Switzerland Retail Sales (Jan)
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Gold traded above $1,150 an ounce on Friday, but still was set for a sixth weekly decline in seven amid expectations interest rates in the US would be raised soon. So far bullion has lost around 0.7% this week, after sliding to the lowest level in more than three months at $1,147.10 on Wednesday. Reflecting investors' bearish sentiment, holdings in SPDR Gold Trust, the world's biggest gold-backed exchange-traded fund, declined 0.28% on Thursday to 750.95 tonnes, the lowest level since late January. It has been three weeks of continuous outflows from the fund.
US retail sales unexpectedly declined for a third month in a row in February as harsh weather and tepid wage growth restrained shoppers. The Commerce Department said sales at US retailers fell by a seasonally adjusted 0.6% last month, against analysts' expectations for a 0.3% gain, and following the 0.8% drop in January. It was the first time since 2012 that sales had declined for three straight months.
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Chinese FDI, Swiss retail sales to move markets on Monday
In the beginning of next week, China's Ministry of Commerce is expected to announce a yearly increase in foreign direct investment to the country in February. Any result of this indicator will follow a 29.4% climb in January, while cooling world's second biggest economy may provide the FDI with worse numbers than can be estimated, thus giving impetus to purchases of safe-haven assets.Read More: Fundamental Analysis
XAU/USD develops inside bearish channel on daily chart
On January 22, the level at 1,300 which acted as a strong supply for Gold forced the yellow metal to resume declining. Moreover, the bullion succeeded in consolidating below 1,200 during the first week of March, following a period of considerable losses. Taking into account strength of US fundamental factors and potential positive effects from the expanded asset purchases programme in the Eurozone, the long-term outlook for Gold is remaining fairly bearish. Even though some medium-term bullishness can be created by the 2014 low around 1,130, the precious metal is likely to develop below this level in course March-April time period. Moreover, in case of consolidation below this mark, a drop down to 2010 low at 1,044 will be broadly expected to take place towards the end of May.Daily chart
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The longest streak of losses for Gold in 17 years was set on March 12, 2015. Yesterday, the bullion failed to recover, even though the spot was growing above 1,165 at some points of time. However, bearish pressure outweighed bullish intentions for a rise and even gave the yellow metal a slight decrease down to 1,154. Nevertheless, in the early morning of Friday the precious metal is making a second attempt to jump. Bullish development is still more preferable today, given there is a strong demand zone around 1,145 (weekly S1; Bollinger band).
Hourly chart
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Read More: Technical Analysis
SWFX opened positions remain positive
Meanwhile, OANDA's bulls continue to enjoy a firm majority as their share of total opened trades stays at 69.38% at the moment, thus giving a rise of less than one percent from yesterday. As a result, Gold's sentiment is currently the third most positive among major currency pairs at OANDA. In addition, SaxoGroup market participants are also positive with respect to the yellow metal, as there are 66% of bullish positions registered by 6:45 GMT on March 13.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Feb 13 and Mar 13 expect, on average, to see Gold trading just above 1,200 by the end of June. At the same time, 53% of them still believe the bullion will be strongly above this mark in three months, while 29% of traders surveyed forecast the bullion to trade in the range between 1,050 and 1,200.
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