During the second part of Tuesday's trading, the yellow metal's price reached the resistance zone just above the 1,745.00 level. The metal immediately bounced off it and retraced back down.
By the middle of Wednesday's trading, the price was trading near the 1,740.00 level.
On Wednesday, at 19:00 GMT, the US Federal Open Markets Committee is set to publish its Meeting Minutes.
Click on the link below to find out more about the data releases of this and other currency exchange rates.
XAU/USD short-term forecast
On Wednesday, the price was being approached by the support of the 55-hour simple moving average. If the SMA provides enough support for the price to push through the resistance of the zone above 1.745.00, the metal could test the resistance of the March high level near 1,755.00.
On the other hand, a potential decline of the metal would reach for the combined support of the zone below the 1,725.00 level and the 100 and 200-hour simple moving averages.
Hourly Chart
On the daily chart, the support zone of the March low levels is not made up only of the recent lows. Research the 2020 March high levels and the 2020 April to June low levels. The zone was providing both resistance and support during last year.
Most recently, on Tuesday, the price passed the resistance line, which kept the metal declining throughout 2021. Namely, the described support zone provided enough support of the metal to break the resistance line.
Daily Candle Chart
Short term traders took profits
Since Tuesday, the sentiment on the Swiss Foreign Exchange was bullish, as 67% of open position volume was long.
Note that the gold sentiment is largely bullish at all times due to long term holders. It is quite rare for it to be below 70%. Due to that reason, on Tuesday, it was assumed that short term traders had closed their long positions and probably opened short positions.
Meanwhile, in the 1000-pip range around the metal's price the pending orders were 75% to buy the metal.
Previously, the orders were 51% to buy.