- Opened positions on Gold remain strongly positive (74% bullish / 26% bearish)
- The closest resistance for the yellow metal is currently located at 1,195
- At the same time, the closest support for the bullion is placed at 1,188
- Upcoming events on April 27: US Markit Services PMI (Apr), UK Nationwide HPI (Apr), Reserve Bank of Australia's Governor Glenn Stevens Speech, Japan Retail Sales (Mar)
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Gold steadied at the $1,190 level after falling sharply through the important $1,200 level on Wednesday, as the US Dollar retreated amid weaker than expected fundamentals. Jobless claims unexpectedly rose by 1,000 to 295,000 in the week ended April 18, while activity in the US manufacturing sector declined to the lowest level in three months.
Investors' attention now turns to today's crucial Eurogroup's meeting in Riga, Latvia, where Greece's progress in its reform pledges will be top of the agenda. Yesterday, Greece's Prime Minister Alexis Tsipras urged Angela Merkel, the Chancellor of Germany, to help speed up the negotiations over the Greek bailout, in an attempt to prevent a potentially catastrophic default in the coming weeks.
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RBA's Stevens to speak in Sydney on April 27
On Monday of the next week, the Governor of the Reserve Bank of Australia Glenn Stevens is going to give a speech at the Australian Financial Review Banking and Wealth Summit in Sydney, with this event marked as one of the most important on April 27. In the meantime, Japan will announce data on retail sales for March, while Markit is going to reveal the PMI activity indicator for services industry in the US.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, at that time located around 1,150. Towards the end of June the bullion is likely to develop in the direction of the upper boundary of this pattern just below 1,260 where bears are forecasted to overtake a lead and drive the metal back to the south. However, the metal can also be stopped by the 200-day SMA around 1,220. The overall negative trend for Gold seems 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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On Thursday, the bullion rebounded marginally after a significant slump that took place a day before, on Wednesday. By getting support from weekly S1, bulls decided to act and pushed Gold towards 55/20-day SMAs at 1,195. Nevertheless, the short-term outlook for the yellow metal remains bearish. Moreover, as the gap between 55 and 200-day SMAs is widening, it points on a strengthening pace of a drop. However, for the negative scenario to be confirmed in medium-term, the bullion should retreat below 2013 low at 1,180.
Hourly chart
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Read More: Technical Analysis
SWFX opened positions on Gold remain strongly positive
Meanwhile, OANDA's bulls continue to enjoy a firm majority as their share of total opened positions stays at 65.29% at the moment, and Gold's sentiment there is currently the fifth most positive among all major currency pairs. Saxo Bank market participants, in turn, are also confident with respect to the precious metal, as there are 61% of bullish positions registered by 5:30am GMT on April 24.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Mar 24 and Apr 24 expect, on average, to see Gold trading just below 1,250 by the end of July. At the same time, 53% of them still believe the bullion will be strongly above this mark in three months, while 32% of traders surveyed forecast the bullion to trade in the range between 1,100 and 1,250.
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