The yellow metal started the week by trading sideways between 1,510.00 and 1,515.00. The sideways trading was expected to continue until the end of the day.
In regards to the near term future, the rate was more likely to surge than decline, as it was being approached by the support of the 55-hour simple moving average.
FOMC Statement and Federal Funds Rate
The Federal Reserve released the US Federal Funds Rate data, which came out in line with the expectations of 1.75%.
According to the official release: "Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. In light of the implications of global developments for the economic outlook as well as muted inflation pressures, the Committee decided to lower the target range for the federal funds rate to 1-1/2 to 1-3/4 percent."
Economic Calendar Analysis
This week there is only one event scheduled that could impact the rate.
On Tuesday, the US ISM Non-Manufacturing PMI is set to be released at 15:00 GMT.
Meanwhile, take into account that the next week's reaction tables have been published. Take a look at the 04.11-08.11 Event Historical Reactions publication.
XAU/USD short-term forecast
During Friday, the XAU/USD exchange rate traded sideways within the 1,510.00/1,515.00 area. During today's morning, the rate maintained its consolidation.
Given that gold is supported by the 55-hour moving average at 1,508.83, it is likely that the rate could re-test the upper boundary of the medium-term ascending channel at 1,519.00.
If the given channel holds, a reversal south could occur. In this case the price for gold could decline to the 1,500.00 mark. Otherwise, yellow metal could extend gains against the Greenback in the short term.
Hourly Chart
On the daily candle chart, the commodity price has pierced the lower trend line of the large scale ascending channel pattern. The pattern represents the metal's surge, which has occurred since the start of summer.
It might be the first signal that the surging of the metal is over.
Daily Chart
Sentiment remains unchanged
Since Friday, 55% of open gold position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, in the 1000 base point range around the current metal's price the pending orders were bullish– 61% of orders were to buy and 39% to sell.
On Friday, the orders were neutral.