- SWFX market sentiment is 64% bullish
- Pending orders in the 1000-pip range are set to sell in 63%% of cases
- US Federal Reserve causes high volatility
Initially, as the US hiked their interest rates on the USD, gold prices dropped dwon to the 1,242.00 level. However, it was later revealed to the markets that the Federal Reserve intends to decrease their monetary policy squeezing in the near future. Namely, there will be two rate hikes in 2019 instead of the previously planned three interest rate hikes. This indicates that the USD intrinsic value is lower than it was previously expected.
Latest Fundamental Event
The oil price has appreciated after the US Crude Oil Inventories data release on Wednesday at 15:30 GMT. The one-minute candle gained 29 pips, or 0.60% right after the data release. In the next minutes, the rate was trading at the 47.80 level against the US Dollar.
The Energy Information Administration released the US Crude Inventories data that came out better-than-expected of negative 0.5M, compare to forecasted negative 2.7M.
John Kilduff, the partner at Again Capital Management in New York said, "There was an appreciable rise in demand for the diesel fuel category and a rather large drawdown in stocks. The crude oil drawdown, however, was much smaller-than-expected, which moderated the report, as did the large inventory increase at the Cushing delivery hub."
Week will end with US and Canadian data
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 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 the previous trading session, the gold depreciated against the US Dollar by 1304 pips or 1.04% to end the trading session at the 1,243.36 mark. On Thursday, the gold was recovering to trade at the 1,248.00 level.
Most likely, the yellow metal will surge upwards due to the support level of the 55-hour simple moving average. Moreover, it expected that the rate could reach the 1,254.00 level during the day.
On the other side, the gold might trade sideways to stay at the 1,248.00 level.
Hourly Chart
As we stated weeks ago, the yellow metal is heading to the 1,260.00 level. It is set to be touched during this week's trading.The aftermath of the event will be the testing of the upper trend line of a large scale ascending pattern. Gains will be limited during that period.
Daily Chart
Neutral set up trader orders
Some traders had taken profits. On Wednesday 67% of trader open positions were long, and the sentiment was above 70% before that.
By the middle of Thursday's trading the traders of the Swiss Foreign Exchange were already 64% long on the metal.
In the meantime, trader pending orders in the 1000-base point range are mostly set to buy under various circumstances. Namely, 64% of pending orders were set to sell.
Profits have been taken during the recent decline. Meanwhile, traders are prepared to reopen them to continue taking advantage of the surge.