- Opened positions on gold are strongly bullish (73% long / 27% short)
- The closest resistance for the yellow metal is currently located at 1,187
- At the same time, the closest support for the bullion is placed at 1,179
- Upcoming events on June 15: Bundesbank President Weidmann Speech, Italy CPI (May), Euro zone Trade Balance (Apr), ECB President Draghi Speech, US Industrial Production (May) and Empire State Manufacturing Index (Jun), Switzerland Retail Sales (Apr), Canada Manufacturing Sales (Apr)
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US retail sales surged sharply in May and rose for the third month in a row, as households boosted purchases of automobiles and a range of other goods. The better-than expected data is likely to strengthen the Fed's confidence in the second quarter growth rebound. Retail sales climbed a seasonally adjusted 1.2% last month, the Commerce Department said.
The increase in retail sales, which makes up as much as one-third of all consumer spending, provides more signs the economy has regained momentum after contracting in the first quarter. Yet sales may have also been boosted by the Memorial Day holiday that gave people an extended weekend in which to shop.
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Next Monday to be full of events and data releases
Monday of the next week will be unusually busy in terms of many data releases and other events that can potentially have an impact on both foreign exchange and commodity markets. Among them, Bundesbank and ECB President will speak in Frankfurt and Brussels, respectively. Among core fundamentals, Switzerland will release the numbers on retail sales in April at 07:15 AM GMT, followed by Italian inflation and Euro zone trade balance data at 08:00 AM GMT and 09:00 AM GMT, correspondingly. From the US side, markets will wait for the statistical releases on industrial production and the New York State manufacturing activity.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. Two pattern's boundaries are represented by the upper trend-line around 1,270 and pattern's support at 1,115. Among recent developments, in March 2015 the yellow metal resumed gaining value, even without touching the lower trend-line. In the foreseeable future gains are likely to be limited and the bullion should be driven by the 200-day SMA around 1,210 with a slight bearish bias. Some short-term gains in the direction of the long-term downtrend (1,270) are not completely off the table, but bears are eventually going to overtake a lead and drive the metal back to the south. The overall negative tendency for Gold seems to be the case in the long run, while at the end of this year the precious metal should to consolidate around 1,150, in case the present trend persists.Daily chart
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Gold registered a first decline in price this week on Thursday, following a release of strong macro numbers in course of the day. At the same time, even though a three-day bullish trend of the metal came to an end, gold rejected the idea of falling below the weekly pivot point at 1,179. Therefore, outlook for the short-term remains slightly upbeat and a surge above the 20-day SMA (1,187) is possible. On the other hand, daily and monthly technical studies continue to assume the bullion is at risk of falling.
Hourly chart
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SWFX long opened positions on gold above 70%
Meanwhile, OANDA's bulls are in the safe majority with 73.12% (+2%) of all current positions. Gold's sentiment at OANDA is the second most positive among all major currency pairs at the moment. Saxo Bank market participants are also optimistic with respect to the precious metal, as there were 64% of bullish trades registered by 5:30 AM GMT on June 12.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between May 12 and June 12 expect, on average, to see Gold trading around 1,220 by the end of September. At the same time, 53% of them believe the bullion will be even strongly above 1,200 in three months, while 27% of traders surveyed forecast the bullion to trade in the range between 1,050 and 1,200.
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