Since Monday, the XAU/USD exchange rate has been testing the lower boundary of the ascending triangle pattern.
From a theoretical point of view, it is likely that a reversal north could occur in the nearest future.
This week, monthly US inflation and retail sales data sets are bound to cause notable reactions, as they have done in the past. Namely, the US PPI on Wednesday and the US Retail Sales on Friday are being released at 12:30 GMT.
XAU/USD short-term forecast
On Tuesday, the XAU/USD exchange rate failed to surpass the 1,710.00 level. During today's morning, the rate was testing the lower line of the ascending triangle pattern.
From a theoretical point of view, it is likely that a reversal north could occur in the nearest future. In this case the price for gold could exceed the 1,710.00 mark.
However, note that the rate would have to surpass the 55– and 100-hour SMAs near 1,705.00. If the given resistance hold, a breakout south from the pattern could occur, and the price for gold could decline below 1,695.00.
Hourly Chart
On the daily candle chart, the metal is overbought, as its price is far above the daily simple moving averages. The most close by 55-day SMA was located at the 1,647.00 mark.
Daily Candle
Traders are long on gold
Since Friday, the Swiss Foreign Exchange sentiment has been 57% long.