- Opened positions on Gold remain positive (62% bullish / 38% bearish)
- The closest resistance for the yellow metal is currently located at 1,186
- At the same time, the closest support for the bullion is placed at 1,180
- Upcoming events on April 1: ECB Non-Monetary Policy Meeting; China, Euro zone, UK and US Manufacturing PMI (Mar); US ADP Employment Change (Mar)
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Consumer spending in the US advanced less than expected in February 2015, indicating that economy may be losing momentum after several quarters of strong growth. Personal expenditures gained 0.1% last month; however, it has been a first rise in three months, which followed a downward change of 0.2% and 0.3% in January and December, respectively.
Meanwhile, last month salaries jumped 0.4% on a monthly basis, more than 0.3% projected by analysts and up from a 0.3% rise in January. Wages is one of the key issues for the Federal Reserve, which is going to make future decisions on interest rates, based not only on consumer price developments, but also on labour market situation and wage tendencies.
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Several countries to release PMI indicators on April 1
On the first day of April, many countries around the world are going to publish important indicators concerning activity in their production sectors. The list of major countries/regions includes China, the UK, US and Euro zone. Moreover, employment change in the world's biggest economy is projected to be more pronounced in March than a month before, as markets expect the ADP to announce a 225,000 gain in employment during the period.Read More: Fundamental Analysis
XAU/USD develops inside bearish wedge pattern on daily chart
Since the second quarter of 2013, the bullion has been developing inside the falling wedge pattern, meaning that trading range is decreasing as time goes on. In March 2014, however, the yellow metal resumed gaining value, even without touching the lower trend-line which is currently located around 1,100. Therefore, towards the end of April the bullion is likely to approach the upper boundary of this pattern just below 1,280 where bears are forecasted to overtake a lead and drive the metal back to the south. The overall negative trend for Gold seems also inevitable in the long-term future, while at the end of this year the precious metal is likely to consolidate around 1,150, in case the present trend persists.Daily chart
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In line with expectations, XAU/USD failed to limit its downward correction within any range above the long-term downtrend line. Gold lost around $15 per ounce on Monday and fell back below the major support line at 1,192. At the same time, the bullion received some bullish impetus from 2013 low and weekly S1 at 1,180 which capped the yellow metal from losing even more value. Despite bullish daily technical indicators, a short-term rebound seems unlikely, while a slump below 1,173 (monthly S1) might clear the way towards weekly S2 at 1,158.
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 62.87% at the moment, a marginal decrease from Monday morning. Gold's sentiment is currently the fourth 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 67% of bullish positions registered by 5:30 GMT on March 31.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Feb 28 and Mar 31 expect, on average, to see Gold trading at 1,200 by the end of June. At the same time, 51% of them still believe the bullion will be strongly above this mark in three months, while 31% of traders surveyed forecast the bullion to trade in the range between 1,050 and 1,200.
© Dukascopy Bank SA