- SWFX traders are 55% bearish
- 80% of pending orders in 800-pip range are set to BUY
- Signifficant resistance at 1,357.29
- Upcoming Events: Event-free day
Yesterday the exchange rate expectedly continued to climb to the top, using a support provided by the 55- and 100hour SMAs. Since the gold has reached the upper edge of a long-term rising wedge, the downward movement is expected to guide the pair in the next two days.
EUR/USD revealed muted reaction on the ECB rate announcement ahead of the Central Bank's policy statement. . However, the first half an hour of the Mario Draghi speech put the European single currency 72 pips higher against the US dollar, while the further course of press conference managed to keep the Euro above the 1.2000 level.
The ECB President Mario Draghi noted that volatility in the Euro exchange rate was a source of unclarity, causing the necessity to monitor the FX rate impact on price stability being very important for inflation targets and growth. Mr. Draghi stated that underlying inflation trends had improved, but continued to be relatively subdued, while confidence surrounding the future economic growth remained strong.
Empty day
Today there will be no significant fundamental events that could affect the price of gold or the buck. For this reason, traders are advised to switch their interest to the Loonie and take a look at the Canadian employment data release at 12:30 GMT.
XAU/USD jumps above 1,352.00
As it was expected, most of the previous trading day the yellow metal spent in an advance against the buck.
On the one hand, this movement was triggered by a combined support created by the 55- and 100-hour SMAs. On the other hand, there is also a need to take into account a pressure from the lower trend-line of a rising wedge, which was moving along the above technical indicators.
For this reason, today the pair is expected to make a rebound from the upper trend-line of this long-term formation and, starting from next week, resume the fall towards the monthly R1 at 1,348.36. However, there is a need to carefully monitor development of the North Korean crisis, as its further escalation might continue to stir interest in the gold.
Hourly Chart
By the moment, the pair has reached an upper trend-line of a long-term ascending channel. From the pattern theory perspective, now the gold has to make a rebound and start moving in the opposite direction. But given an uneasy situation surrounding the Korean peninsula, the bullion might continue the grow until the next combined resistance set up by the monthly R2 and the 100% Fibonacci retracement level at 1,375.45
Daily Chart
Markets sentiment remains bearish
Traders of Dukascopy remain bearish on the price of gold, as 55% of open positions are short. Accordingly, the same percentage of pending commands is to buy the commodity. Moreover, 41% of pending orders are set to sell the buck.
OANDA Gold traders remain relatively neutral, as open positions are only 54% bearish. In the meantime, SAXO bank traders are neutrally bearish, as 51% of open positions are short.