- SWFX traders are 51% bullish
- 62% of pending commands are to buy the metal
- The bullion opened at 1,225.88
-
Upcoming Events: US CPI; US Retail Sales; FOMC Member Evans's Speech; FOMC Member Harker's Speech
The bullion continues the surge in the recently established pattern. However, the metal faces a strong resistance cluster on the daily chart, as the 100-day SMA is keeping the commodity price lower. If the SMA is broken, the bullion might jump as high as the 1,240 mark.
The seasonally adjusted Producer Price Index for final demand rose more than expected in April, official data showed on Thursday. According to the Bureau of Labour Statistics, US producer prices rose 0.5% for the month of April, following the preceding month's 0.1% decline and surpassing analysts' expectations for a 0.2% hike. On a yearly basis, the Producer Price Index posted a gain of 2.5% in the reported month, the strongest increase since February 2012, compared to 2.3% registered in March. A 0.4% advance in prices for final demand services caused over 60% of the rise in the final demand PPI.
Watch More: Dukascopy TV
Upcoming events: US CPI and Retail Sales
During the Friday's Dukascopy research webinar the release of the US CPI and Retail Sales will be covered. The webinar is set to start at 12:00 GMT, and the data will be out at 12:30 GMT. In addition, for a more long term outlook of the strength of the US Dollar side traders would want to listen to the FOMC member speeches, which will take place later in the day. At 13:00 GMT FOMC Member Evans is set to give a speech, and at 16:30 GMT Harker will speak.
Read More: Fundamental Analysis
Gold approaches 1,230 mark
On Friday morning the yellow metal's price moved higher, as it was attempting to break the resistance, which is put up by the 100-day SMA. The SMA on Friday morning was located at the 1,228.32 level. As the SMA has kept the rate lower for the past three trading session, a break of it would release the piled up bullish momentum, which can be observed also in the SWFX market sentiment. The resulting surge could result in the commodity price reaching the weekly PP at 1,242.06, which is the closest resistance level above the mentioned simple moving average.
Daily chart
On the hourly chart the yesterday discovered ascending channel pattern remains in force. In addition, a short term ascending channel has also appeared. Although their credibility is dubious, as the latest surge in the yellow metal was caused by political events in the US.Hourly chart
Read More: Technical Analysis
Bulls dominate
SWFX traders are almost neutral, as 51% of open positions are long. Meanwhile, 62% of trader set up orders are to buy the metal.
OANDA Gold traders remain bullish, as open positions are 73.84% long on Friday, compared to 70.64% previously. Meanwhile, traders of SAXO bank remain firm, as 68.03% of open positions are long, compared to 69.05% positions on Thursday.
Spreads (avg, pip) / Trading volume / Volatility
Market participants foresee the price of gold being below 1,350 in August
© Dukascopy Bank SATraders who were asked regarding their longer-term views on gold between April 12 and May 12 expect, on average, to see the metal near 1,350 in early August. Generally, 46% of participants believe the price will be above 1,350 in ninety days. Alongside, 37% (+1%) of those surveyed reckon the metal will trade in the range between 1,200 and 1,350 over the next three months.