This week, various Federal Reserve speakers are giving speeches about monetary policy. It appears that they could make comments that create sudden moves.
In regards to macroeconomic data releases, on Wednesday, the US Federal Reserve Federal Open Market Committee Meeting Minutes, which is the name for Fed meeting protocol, will be released. The pdf file could provide more insight how the Fed decided to do nothing about the returning inflation
On Thursday, markets will be watching the European, UK and US Markit Flash Services and Manufacturing sector Purchasing Managers Indices. The PMIs are survey results of the mentioned sectors. The survey results could surprise the financial markets by revealing that a certain country is doing better or worse than thought. As a result the respective currency should either loose or gain value against other financial assets.
XAU/USD short-term forecast
A move below the combination of the 50-hour simple moving average, the 2,400.00 mark and the zone that surrounds it could result in the price looking for support in the 100-hour simple moving average near 2,385.00. In addition, the support line of the broken channel pattern could still act as support, before the rate plummets to the support levels near 2,360.00.
On the other hand, a recovery of the price could be slowed down by the 2,420.00 and 2,430.00 levels, before the 2,450.00 is tested once again.
XAU/USD daily charts review
The decline of the metal's price that was correctly forecast is over. The metal has revealed a support zone near the 2,300.00 and most recently broken the channel down pattern that captures the metal's correction. In general, the price had surged too high to fast. Selling had to occur, before more gains occur.Previously, the 50-day simple moving average was expected to push the metal's price into testing the resistance of the 2,400.00 mark.
Most recently, it has occurred and the 2,450.00 is now the resistance.
Daily Candle Chart
Traders remain short
At the start of the week, traders were shorting, as 72% of open positions were short. Meanwhile, pending orders were 60% to buy.
Traders were less short at the start of the month, which signals that losses have been suffered during the ongoing resumption of the surge. Moreover, more short positions have been added.