During Thursday morning, the price for gold was testing the support formed by the 55-, 100- and 200-hour SMAs, located circa 1,410.00.
If the given support holds, a reversal north is expected within the following trading session.
Institute for Supply Management released the US ISM Non-Manufacturing PMI data , which came out worse-than-expected of 55.1 compared with the forecast of 56.1.
According to the official release: "The NMI registered 55.1 percent, which is 1.8 percentage points lower than the May reading of 56.9 percent. This represents continued growth in the non-manufacturing sector, at a slower rate. This is the index's lowest reading since July 2017, when it registered 55.1 percent. According to the NMI, 16 non-manufacturing industries reported growth. Although the non-manufacturing sector's growth rate dipped in June, the sector continues to reflect strength. The comments from the respondents reflect mixed sentiment about business conditions and the overall economy. A degree of uncertainty exists due to trade and tariffs."
For this pair the week will end with the US Employment data sets – the Average Earnings, Unemployment Rate and Non-Farm Employment Change.
XAU/USD short-term forecast
As it was expected previously, the price for gold declined to the support level formed by the 55-, 100– and 200-hour SMAs, located circa the 1,410.00 mark.
If the given support holds, it is expected, that the XAU/USD exchange rate could reverse north within the following trading session.
However, it is unlikely, that gold could exceed the 1,435.00 mark against the US Dollar in the short term due to the resistance of the upper boundary of the long-term ascending channel.
If the given support does not hold, the price for gold could maintain its decline. A possible downside target is the 1,400.00 level.
Hourly Chart
On the daily chart, it can be observed that the decision to mark historical high levels was a correct one.
Namely, one can observe that the zone surrounding the August 2013 high level provided resistance to the commodity price.
Daily Chart
Traders are neutral on gold
On Thursday, on the Swiss Foreign Exchange 47% of open gold position volume was in long positions.
Meanwhile, in the 1000 base point range around the current metal's price the orders were bullish - 67% of orders were set to buy.