As the yellow metal's price was looking for support in the 100-hour SMA in the aftermath of breaking out of the ascending triangle pattern, the Federal Reserve made an announcement.
Namely, the stimulating US monetary policy would remain intact. It caused high volatility with an initial surge to the 1,750.00 level and afterwards the 1,755.00 level. It was followed up by a decline to the 1,720.00 level on Thursday.
There are no more notable events scheduled for this week. On Friday, expect an update to the calendar section with the next week's event reviews.
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
During Thursday's US trading hours, the metal's price was recovering. It was set to test the 55-hour SMA. If the SMA does not provide resistance, the price would first test the 1,740.00 level and afterwards the 1,750.00 mark.
On the other hand, potential declines could look for support in the 100-hour SMA near 1,730.00 and the 1,730 mark itself. Below them, note the 200-hour SMA and the 1,720.00 level.
Hourly Chart
On the daily candle chart, the metal could find resistance in the 50.00% Fibonacci retracement level at 1,763.74. This level provided the commodity with support in late November and February.
In the meantime, the June low level of 1,672.39 has been marked on the chart. This level could provide support.
In addition, note that prior to the Fed announcement volatility was almost gone. In theory, a lack of volatility eventually results in a sharp move.
Daily Candle Chart
Long sentiment increases
On Thursday, the sentiment on the Swiss Foreign Exchange was bullish, as 70% of open position volume was long.
On Wednesday, the sentiment was 68% long.
Note that the gold sentiment is largely bullish at all times due to long term holders.
Meanwhile, in the 1000-pip range around the metal's price the pending orders were 56% to buy the metal.