Gold reaches 1,200 as forecast

Note: This section contains information in English only.
Source: Dukascopy Bank SA
  • SWFX market sentiment is 73% bullish
  • Pending orders in the 1000-pip range are set to buy in 58% of cases
  • US CPI will impact gold prices on Wednesday

The 1,200 level was reached, as it was already stated on Monday. The decline has occurred step by step not in a fast decline.

Latest Fundamental Event

The Federal Reserve released US Federal Funds Rate that came out in line with expectation of 2.25%. In addition, the FOMC Statement data release came out on Friday at 19:00 GMT.

Marc Chandler, chief market strategist at Bannockburn Global Forex comments "Fed says little and does less. Recognizes strong economy and acknowledges moderation of business investment, with inflation near target. Nothing to do. No hint at money market pressures or weakness in housing. FOMC to market: See you in December. Gradual hikes to continue."

Watch out for US CPI on Wednesday

On Wednesday, there are two data releases that are set to be covered. Namely, at 09:30 GMT the UK CPI will be published. Afterwards, at 13:30 GMT the US CPI and Core CPI data sets will be released.

Thursday will be the last day with notable data releases. At 09:30 GMT the British will publish their retail sales data. Afterwards, at 13:30 GMT the US statisticians will publish their retail sector data.

For more in-depth analysis of this week's fundamental economic events watch the weekly Monday's Poking the Economic Calendar webinar, which is live each Monday at 12:00 both on Dukascopy telefision and YouTube.
Join the Webinar: Webinar Platform

XAU/USD short term forecast

In regards to the near term future. The junior descending pattern clearly dictates the rules while the dominant pattern lines on the hourly chart only have minor impact. In accordance with this pattern, the commodity price should decline.

However, the rate is facing the lower trend line of the most dominant large scale ascending pattern. Watch closely that trend line just at 1,200.00 level. If the gold price clearly drops below it, the 1,185.00 level could be aimed at.

Hourly Chart


As it was forecast, the lower trend line of the dominant pattern has been reached. The short term forecast already describes, how the situation is working out and how one should trade the possible breaking of the pattern or the bounce off from the trend line.

Daily Chart

Massive amount of buy orders

Traders remain long on gold. 73% of all open positions were long on gold. Although, note that there are a lot of gold holders not traders involved in this statistic.

Meanwhile, in the 1000 base point range 58% of trader set up orders were set to buy. On Monday, more than 70% were set to buy. Moreover, on Friday the percentage was above 80%.

In general, the percentage of long to short positions has not changed. However, the large amount of buy orders has disappeared during the recent decline down to the 1,200 level.

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