This week, markets will watch the publication of the US Consumer Price Index on Wednesday at 13:30 GMT. The inflation data will reveal whether the US government and the central bank can continue to stimulate the economy.
However, the markets already expect annual inflation to have increased from 2.4% up to 2.6%.
On Thursday, inflation at the wholesale level will be revealed. At 13:30 GMT, the Producer Price Index data sets will be published.
Lastly, on Friday, at 13:30 GMT, the US Retail Sales data release might impact the markets via the US Dollar.
XAU/USD short-term forecast
In the near term future, the metal is expected to extend the decline and look for support in the 2,590.00/2,600.00 range. If this range fails, the commodity price might find support in the 2,570.00 and 2,560.00 levels.
Note that a potential recovery of the metal's price above the resistance range near 2,620.00 is expected to face resistance in the 2,640.00 level. Higher above, note the 50 and 100-hour simple moving averages that are descending near 2,680.00.
XAU/USD daily charts review
On the daily candle chart, the metal has passed below the 50-day simple moving average and has reached the lower trend line of the channel up pattern.If the pattern is broken, the 100-day SMA might still save the metal, but note that a broken pattern indicates that the surge is over.
Daily Candle Chart
Traders were short
Last week, 66% of volume was in short positions. Traders were shorting gold.
Meanwhile, in the 1000 point range around the latest price, the pending orders were 88% to sell the metal.
This week, we observed that profits had been taken, as 58% of volume was short and orders were 60% to sell.