- Opened positions on Gold remain strongly positive (71% bullish / 29% bearish)
- The closest resistance for the yellow metal is currently located at 1,211
- At the same time, the closest support for the bullion is placed at 1,200
- Upcoming events on April 30: Germany Retail Sales (Mar) and Unemployment Change (Apr), Euro zone Final CPI (Apr) and Unemployment Rate (Mar), US Unemployment Claims (Apr 24) and Personal Spending (Mar), Bank of Japan Interest Rate Decision and Monetary Policy Statement, Japan CPI (Mar) and Unemployment Rate (Mar)
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Gold traded near the highest level in three weeks as weaker than expected data from the US hurt the Greenback and lowered expectations for the Fed's interest rate hike in June. US consumer confidence unexpectedly fell this month amid a slowdown in job creation and concerns about near-term economic outlook. The data added to the recent string of soft fundamentals, sparking expectations the US central bank would postpone an interest rate increase to later this year.
Investors will receive more insight on the US economy's performance later today, when advance GDP of the first quarter will be released, just hours before the FOMC statement. The US economy is expected to grow 1.0% in the three months through March, compared with a revised 2.2% growth in the last quarter of 2014.
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Bank of Japan meets to make benchmark rate decision
Even though the Bank of Japan is not expected to make any changes to the main interest rate, some analysts see a potential for additional stimulus from the Japanese monetary regulator due to falling inflation rate. Meanwhile, the consumer price index for the world's third largest economy will be released on Thursday as well, which will be followed by Japan's unemployment statistics.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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Following a considerable gain on Monday, the yellow metal continued jumping significantly during the second trading session of this week as well. The bullion surged more than $10 per ounce and settled above the 100-day SMA at 1,211. This mark is also a location of the Bollinger band at the moment. However, for the near-term outlook to become completely bullish, XAU/USD has to advance above the next resistance zone at 1,221 (monthly R1; 200-day SMA). Otherwise, there is a risk that this supply will eventually push the bullion back to trade downwards.
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 stable majority, and their share of total opened positions rebounded slightly during past 24 hours to reach 62.63% on in the morning today. Gold's sentiment at OANDA is currently only the sixth most positive among all major currency pairs. Saxo Bank market participants, from their side, are also optimistic with respect to the precious metal, as there are 57% of bullish positions registered by 5:30am GMT on April 29.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Mar 29 and Apr 29 expect, on average, to see Gold trading around 1,230 by the end of July. At the same time, 48% of them still believe the bullion will be even above 1,250 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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