The bullion begins the new week with a decline. However, all clues indicate that the gains of the yellow metal are still set to increase. The reason for that is the fact that the bullion is only being held back by one resistance level on the hourly chart.
The number of Americans filing for unemployment benefits dropped unexpectedly last month, official figures revealed on Thursday. The US Department of Labour reported that initial jobless claims fell to 232K in the week ending May 12, following the preceding week's 236K and posting the third consecutive decline. In the meantime, analysts held expectations for an increase to 240K. Claims remained below the 300K level for 115 straight weeks, the longest stretch since 1973.
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Gold trades above 1,250 level
The yellow metal remains above the 1,250 level, and it is still positioned for additional gains in the near future. The reason for that is the fact that the bullion is above a strong support cluster, which is located from the 1,243 to the 1,249 levels. Meanwhile, the commodity price faces no resistance up to the 1,269 level, where the monthly PP and a medium term trend line are located at. Most likely the bullion will reach for the resistance and bounce off of it during the next upcoming trading sessions.
Daily chart
Hourly chart
Bulls dominate
SWFX market sentiment remains almost neutral, as 51% of open positions are short. However, 65% of trader set up orders are to buy.
OANDA Gold traders remain bullish, as open positions are 69.03% long on Monday, compared to 69.95% previously. Meanwhile, traders of SAXO bank have done the same, as 55.27% of open positions are long, compared to 55.77% positions on Friday.
Spreads (avg, pip) / Trading volume / Volatility
Market participants foresee the price of gold being below 1,350 in August
Traders who were asked regarding their longer-term views on gold between April 22 and May 22 expect, on average, to see the metal near 1,350 in August. Generally, 50% (-1%) of participants believe the price will be above 1,350 in ninety days. Alongside, 34% (-1%) of those surveyed reckon the metal will trade in the range between 1,200 and 1,350 over the next three months.