- Opened positions on Gold remain positive (68% bullish / 32% bearish)
- The closest resistance for the yellow metal is currently located at 1,198
- At the same time, the closest support for the bullion is placed at 1,182
- Upcoming events on March 25: Germany IFO Business Climate (Mar), US Durable Goods Orders (Feb), Switzerland UBS Consumption Indicator (Feb), UK BBA Mortgage Approvals (Feb)
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According to the President of the Federal Reserve Bank of St. Louis James Bullard, markets should expect a greater volatility due to uncertainty over the Fed's future monetary policy decisions, especially when coming closer to the eventual increase of the federal funds rate. The same situation has already been observed in 2013, when the Fed decided to taper its bond purchases.
Among other news on Monday, US existing home sales showed a worse-than-forecasted result for a fourth time in a row in February. Despite that, sales rose 1.2% to 4.88 million on the annualized basis during the previous month, up from the 8-month low of 4.82 million seen in January when they slipped as much as 4.9% on a monthly basis.
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Data across the world to have influence on Gold
Tomorrow, a number of important fundamental indicators will be released in different countries, with a potential impact on Gold expected to be rather noticeable. For Gold traders, the most interesting data is probably going to be the US durable goods orders which are estimated to rise slightly by 0.2% in February. Apart from that, market will closely watch the German IFO Business Climate Index, UK BBA mortgage approvals and Swiss consumption indicator from UBS.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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XAU/USD cross continued to recover from its worst loss which sent Gold below 1,150 during the second week of March. Yesterday in particular, the bullion managed to consolidate well above the 2013 low at 1,190. Technical indicators for the bullion are neutral on short and medium-term time-frames. Nevertheless, two strong support zones (1,180 and 1,173) are likely to provide the yellow metal with reliable bullish momentum. The next resistance is located at 1,198 (weekly R1), where Gold will also meet a down-trend of Jan-Mar bearish move.
Hourly chart
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SWFX opened positions remain positive
Meanwhile, OANDA's bulls continue to enjoy a firm majority as their share of total opened trades stays at 67.24% at the moment, a strong decrease from yesterday. 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 60% of bullish positions registered by 7:30 GMT on March 24.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Feb 24 and Mar 24 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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