- SWFX traders are 55% bearish
- 52% of pending orders in 1000-pip range are set to BUY the gold
- Closest support level at 1.310.77
- Upcoming Events: Empty Day
Last Friday was a notable day for the yellow metal, as it did not manage to hold within a long-term ascending channel. On the other hand, a week ago the pair made a breakout from the rising wedge. In this sense, such outcome was predictable. In addition, the same emerging downtrend was also seen on a daily chart.
The Commerce Department reported that the US retail sales dropped unexpectedly 0.2% over the month of August, missing expectations for a 0.3% increase. The negative changes were mainly due to depressed purchases of motor vehicles likely after Hurricane Harvey, which could cause a further moderation in consumer spending in the Q3. However, a rise in purchases at restaurants and furniture outlets suggested the demand is set to be supported by a healthy labour market.
Quiet day
Today, as many other Mondays, is not expected to bring any news that could cause a notable volatility in the gold market. For this reason, today traders are advised to take a look at the GBP/USD currency pair and try to foresee a possible effect from the upcoming Governor Carney speech.
XAU/USD breaks long-term channel up
Even though information released about the US Core Retail Sales appeared to be worse than analysts expected, the pair did not manage to stay in a long term-ascending channel. It seems that the breakout was triggered by a combined pressure from the 55- and 100-hour SMAs. It should be noted that such outcome was in line with a daily chart, which suggested that the rate was going to continue to plunge at least until the 61.8% Fibonacci retracement level at 1,278.96. Accordingly, today the pair is likely to continue to move to the bottom, trying to reach the updated weekly S1 at 1,310.77. A recovery of the yellow metal is not expected to follow, as the northern side is reliably secured not only by the above 55- and 100-hour SMAs, but also by the updated weekly PP at 1,325.63 as well as the upper boundary of a new junior channel down.
Hourly Chart
After making a rebound from the upper edge of a dominant long-term channel, the gold was gradually losing value against the buck. On a daily chart it seems that the pair has formed a junior channel down. Consequently, a preliminary target for the rate remains the monthly PP at 1,300.00.Daily Chart
Markets sentiment remains bearish
Traders of Dukascopy remain bearish on the price of gold, as 55% of open positions are short. In the meantime, 56% of pending commands are to buy the commodity.
OANDA Gold traders remain neutral, as open positions are 51% bearish. In the meantime, SAXO bank traders are neutrally bullish, as 55% of open positions are long.