- Opened positions on gold are strongly bullish (71% long / 29% short)
- The immediate resistance for the yellow metal is currently located at 1,180
- At the same time, the nearby support for the bullion is placed at 1,167
- Upcoming events in the next 24 hours: Germany Retail Sales (May) and Unemployment Change (Jun), Euro zone CPI (Jun) and Unemployment Rate (Jun), US Consumer Confidence (Jun), UK Final GDP (Q1) and Current Account (Q1), Canada GDP (Apr), HSBC China Manufacturing PMI (Jun), RBA Governor Glenn Stevens Speaks
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Gold declined in the Asian trading session on Tuesday despite Greece standing on the verge of a debt default. The safe have bid for bullion has surprisingly failed to materialize, after Greece pulled out of meetings with its international creditors over the weekend and called for a referendum on Sunday to vote on the proposed bailout terms. As a result, the Hellenic Country's future in the Euro zone remains obscure. On top of that, Greece's ability to repay the 1.6 billion euro loan instalment to the IMF due today is doubtful.
Meanwhile, contracts to buy previously owned US homes jumped to the highest level in more than nine years in May, adding to signs the US housing market is gaining steam after a wobbly start to the year. According to the National Association of Realtors, the index of pending home sales rose 0.9% to a seasonally adjusted 112.6, the highest since April 2006. The April gauge was revised down to 111.6 from 112.4. Pending home sales surged 10.4% from the previous year.
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Chinese manufacturing to contract further, UK Final GDP due today
Economists forecast the British GDP to be revised upwards in the first quarter of 2015, up from 0.3% to 0.4% amid a bunch of positive fundamentals in March. Alongside, the UK current account deficit is expected to have narrowed in Q1, down from 25.3 billion pounds in Q4 2014 and a record-high shortfall of 27 billion pounds in Q3 2014. All above-mentioned statistics is awaited by 8:30 AM GMT. Meanwhile, Chinese production sector has probably continued to deteriorate this month, as the HSBC manufacturing PMI indicator is due at 1:45 AM GMT tomorrow and is estimated to be released at 49.6 points.Read More: Fundamental Analysis
XAU/USD develops inside bearish wedge pattern on daily chart
Since the second quarter of 2013, the bullion has been developing inside the falling wedge pattern, meaning that trading range is decreasing as time goes on. Two pattern's boundaries are represented by the upper trend-line around 1,270 and pattern's support at 1,115. Among recent developments, in March 2015 the yellow metal resumed gaining value, even without touching the lower trend-line. In the foreseeable future gains are likely to be limited and the bullion should be driven by the 200-day SMA around 1,210 with a slight bearish bias. Some short-term gains in the direction of the long-term downtrend (1,270) are not completely off the table, but bears are eventually going to overtake a lead and drive the metal back to the south. The overall negative tendency for Gold seems to be the case in the long run, while at the end of this year the precious metal should to consolidate around 1,150, in case the present trend persists.Daily chart
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Gold lost value yesterday, following a positive jump in the beginning of the trading day. A new working week opened with a surge above the 2013 low to 1,184, but all gains were erased later in the afternoon. At the same time, the weekly PP and 2013 low have somewhat succeeded in preventing the metal from retreating further. However, on Tuesday XAU/USD decided to move lower, while the closest demand is only offered by the Bollinger band at 1,167. This level is going to be targeted by bears in the short-term, followed by monthly/weekly S1 at 1,162.
Hourly chart
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Read More: Technical Analysis
SWFX long open positions above 70%
Meanwhile, OANDA's bulls are in the safe majority with 81.30% of all current positions. Gold's sentiment at OANDA is the second most positive among all major currency pairs at the moment. Saxo Bank market participants are also optimistic with respect to the precious metal, as there were 70% of bullish trades registered by 5:30 AM GMT on June 30.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between May 30 and Jun 30 expect, on average, to see Gold trading around just below 1,200 by the end of September. At the same time, 55% of them believe the bullion will be above 1,200 in three months, while 24% of traders surveyed forecast the bullion to trade in the range between 1,050 and 1,200.
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