Gold has bounced off dominant support and jumped. It touched the 1,286.00 level before beginning a decline, on Monday.
The commodity price was consolidating its recent gains.
This week all the action on the US Dollar from a fundamental side will be in the second half of the week. Meanwhile, there are large events to watch prior to that.
On Tuesday, the Reserve Bank of Australia might cause moves up to 40 pips on Aussie pairs. At 04:30 GMT the RBA cash Rate is announced. Dukascopy will have a preview video on the Dukascopy Webinars YouTube channel.
On Wednesday, at 02:00 GMT the Reserve Bank of New Zealand will make their rate announcement. This event has caused moves larger than 100 pips during the last two announcements. If you trade sudden moves, get on this, stay late or wake up early.
On Thursday, the usual data starts. At 12:30 GMT the Canadian Trade Balance and the US Producers Price Index will be released. These events can cause a move from five to eighty pips. The range is explained in the weekly Economic Calendar Overview video.
On Friday, there will be two times to watch the calendar.
At 08:30 GMT the UK GDP and Manufacturing Production will be published. This event can cause a move of fifteen to twenty pips.
At 12:30 GMT the Canadian Employment data will cause a move of about forty pips. At the same time the US Consumer Price Index release should cause a move of up to twenty pips. Combined they can have various impacts on the Forex market.
Watch this week's economic calendar analysis and leave comments with questions about the specifics.
XAU/USD short-term forecast
Gold started the week by surging and breaking the resistance of a descending channel pattern. The move was expected, as already on Friday the pair clearly bounced off the support of a dominant pattern and began to surge.
In regards to the near term future, Dukascopy Analytics expects a consolidation of the gains. Namely, the metal's price will remain unchanged by trading sideways.
Afterwards, the hourly simple moving averages would catch up and push the commodity price into the resistance of the monthly PP at 1,287.27
Hourly Chart
On the daily candle chart it is observed that the metal has failed to pass the resistance of the 1,290.00 level.Meanwhile, note that the monthly support level is gone, as a new month has started. The price has no support as low as the 1,263.70 level on the daily candle chart.
Daily Chart
Short sentiment decreases
Throughout last week, on the Swiss Foreign Exchange, 64% of open position volume was in short positions.
On Monday, 62% of trader open position volume was in short positions. The surge has caused the trigger of short stop losses and opening of long positions.
Meanwhile, the trader pending orders revealed an interesting aspect. In the 1000 pip range around the price 70.00% of pending orders are set to buy.
The round proportion might exist due to lack of orders. Namely, there are not many set up pending orders, as a large number of them would create more decimals in the measure of the order proportion.