- SWFX market sentiment is 73% bullish
- 70% of pending orders in 1000-pip range are set to BUY Gold
- US CPI at 12:30 GMT
On Friday morning the bullion managed to finally break free from the support of the hourly simple moving averages. The move resulted in the metal's price declining down to the 1,206.00 level, where it found temporary support.
Oil prices decreased after US Crude Oil Inventories data release on Wednesday at 14:30 GMT. The one-minute candle lost 34 pips, or 0.50%, but the post-reaction caused a drop of 45 pips or 0.66%. In next hours the market recovered to continue fluctuating in the 67.8 area.
The Energy Information Administration released the US Crude Inventories data that came out higher-than-expected. Instead of the expected negative 2.8 million, the data came out only 1.4 million negative.
The Australia and New Zealand Banking Group announced on Wednesday: "Crude oil prices rose as the reality of US sanctions on Iran weighed on sentiment."
The US Consumer Price Index might cause trouble
In regards to the strength of the US Dollar and subsequently the financial instruments that involve the currency, there will be a notable data release occurring on Friday. Namely, the US CPI data sets will be published at 12:30 GMT. The cover of the data will start on the bank's live webinar platform at 12:20 GMT.
Meanwhile, macroeconomic data release traders are more likely going to pay attention to the data release cover at 08:20 GMT. At that time the UK GDP release webinar will begin. The data will be published at 08:30 GMT.
XAU/USD breaks out of triangle
XAU/USD has been moving in a symmetrical triangle during the past few sessions. A bullish breakout from this short-term pattern was halted by the 200-hour and 55-period (4H) SMAs and the 61.80% Fibonacci retracement at 1,216.00.
No significant changes to the pair's direction occurred on Thursday, as the yellow metal was trading in between the 55-, 100– and 200-hour SMAs. This lack of direction changed swiftly early today when Gold lost 0.36% against the US Dollar and returned to re-test a July 2017 low of 1,207.00. This move pushed the rate out of the aforementioned triangle.
It is likely that this bearish move continues in this session, as well. The nearest support is the relatively distant senior channel and the monthly S1 circa 1,200.00.
Hourly Chart
Strong bearish momentum has guided XAU/USD during the last three months. This has resulted in Gold losing 10.80% against the US Dollar.
The given move has sent technical indicators in the strongly oversold territory. Despite being there for a couple of sessions, the rate has yet failed to regain its losses.
Appreciation should nevertheless follow, as bears may soon lack the necessary momentum to push Gold lower. The nearest resistance is a two-week trend-line and the monthly PP at 1,235.00. A breakout from this cluster would create the way for a test of the 55-day SMA located near 1,256.00. on Thursday
Daily Chart
Massive amount of long gold positions
73% of SWFX market traders are going long on the pair. The number of pending orders shows the same bullish tendency, as 56% of set up orders are to buy. Previously, 55% of orders were to buy.
OANDA traders are also bullish on the commodity with 83% of open positions being long today. Saxo Bank traders share the same sentiment with 75% long positions.
There are more than one conclusions, which can be made from the information. First, the larger brokerages with more long term players are more bullish on gold. Second, the retail traders have set up orders to open even more long positions in case the bullion rebounds and surges.