Gold has dropped to the 1,760.00 level and on Friday tested the lower trend line of the declining wedge pattern. Future scenarios were based upon whether or not the trend line manages to hold.
Economic Calendar Analysis
Next week, notable data releases start on Monday. On that day, the US ISM Manufacturing PMI could cause a move.
On Wednesday, the US ADP Non-Farm Employment Change at 13:15 GMT will be on the headlines.
On the same day, at 15:00 GMT the US ISM Non-Manufacturing PMI could cause a move.
On Friday, at 13:30 GMT the US will publish its monthly employment data. The release will consist of the Average Hourly Earnings, Non-farm Employment Change and Unemployment Rate.
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
In the case of the declining wedge pattern holding, the price for gold could retrace back to the resistance of the hourly simple moving averages, which were located from 1,790.00 to 1,796.00.
On the other hand, if the lower trend line of the pattern fails, the price could aim at the 38.20% Fibonacci retracement level at the 1,729.33 level.
Hourly Chart
On the daily candle chart, the rate has pierced the support of the November low level of 1,765.30 and a 50.00% Fibonacci retracement level at 1,763.75. This signals that a further decline is possible.
Daily Candle Chart
Long sentiment grows
On Friday, the sentiment on the Swiss Foreign Exchange was bullish, as 72% of open position volume was long.
On Thursday, 69% of volume was long.
Meanwhile, in the 1000-pip range around the metal's price the pending orders were 57% to buy the metal.
On Thursday, the orders were 68% to buy. A portion of the orders were executed, as more traders went long.