- SWFX market sentiment is 74% bullish
- Pending orders in the 1000-pip range are set to sell in 63%% of cases
- Gold bounced off dominant support line
The medium scale pattern of the daily chart is holding its ground. Namely, it forced the metal into a rebound on Friday. On Monday, the commodity price was back at the 1,240.00 level.
Latest Fundamental Event
The oil price has depreciated after the US Crude Oil Inventories data release on Wednesday at 15:30 GMT. The one-minute candle lost 26 pips, or 0.50% right after the data release. In the next minutes, the rate was trading at the 52.40 level against the US Dollar.
The Energy Information Administration released the US Crude Inventories data that came out better-than-expected of negative 1.2M, compare to forecasted negative 3.0M.
Andrew Lipow, the President of Lipow Oil Associates in Houston said, "The market is disappointed that the EIA did not confirm the 10 million-barrel crude oil inventory draw we saw in the API statistics yesterday and as a result the crude oil price has come off,".
Busy second half of the week for data traders
Until Wednesday there are no notable data releases scheduled to occur that might impact any of the major pairs or gold.On Wednesday, the macroeconomic data releases will start at 09:30 GMT with the UK Consumer Price Index. The event is expected to cause at least a 20 base point move.
On the same day at 13:30 GMT the Canadian will publish the Consumer Price Index data sets. During the last half a year the data release has caused fluctuations of at least 40 pips.
Afterwards at 19:00 GMT the event of the week will take place. Namely, the FOMC Statement and the Federal Funds Rate will be published. The Federal Reserve is expected to hike the US central banks interest rate to 2.5% from 2.25%.
In theory the event is expected to cause a US Dollar surge, which would beat the top pairs downwards. This year the interest rate hikes have caused moves of at least 40 base points.
On Thursday, all attention will be paid to events in the UK. Namely, at 09:30 GMT the UK Retail Sales are expected to cause a move from 10 to 40 pips.
Afterwards, the Bank of England will announce their rate decision. The event has caused moves from 26 to 97 pips since May 2018.
On Friday the data releases will continue. During the morning hours, namely, at 09:30 GMT the UK Current Account will be published. This event causes moves from 15 to 45 pips.
The week's data will end at 13:30 GMT. At that time the Canadian Retail Sales and GDP data will be published. Simultaneously the US Durable Goods data sets and Final GDP will be released.
The last event is too complex to explain it shortly. Instead, state your questions at the weekly Monday's economic calendar stream at 12:00 GMT.
The above mentioned data release will be covered by Dukascopy Analytics. The event can be watched on our YouTube channel.
XAU/USD short term forecast
During Friday's trading session, the yellow metal depreciated against the US Dollar to end the trading session at the 1,236.05 mark. On Monday morning, the gold was trading sideways to stay at the 1,237.77 mark
It is expected that the yellow metal will trade sideways to get resisted by the upper boundary of the freshly drawn pattern at the 1,238.50 mark. The 55-hour simple moving average will help to resist the rate during the day.
However, the gold could appreciate against the US Dollar to break most of the technical indicators to trade near the 38.20% Fibo at the 1,245.07 mark.
Hourly Chart
After confirming the lower trend line of the medium scale pattern on the daily chart gold price faces additional resistance.Namely, the monthly R1 was providing resistance at 1,241.40 and the 38.20% Fibonacci retracement level will slow down the surge of the yellow metal at 1,245.07.
Daily Chart
Large proportion of buy orders
On Friday, 72% of trader open gold positions on the Swiss Foreign Exchange were long. By the middle of Monday's trading 74% of traders were long.
In the meantime, trader pending orders in the 1000-base point range were set to sell the metal in 64% of cases. Previously, the orders were to buy in 73% of cases.
Short term traders have longed the recent rebound and are prepared to take profit and close their positions.