- SWFX traders are 54% bullish
- 60% of pending orders in 500-pip range are set to BUY the gold
- Pair leaves ascending channel
- Upcoming Events: US Building Permits, Housing Starts and Crude Oil Inventories
In result of the previous trading session, the exchange rate slipped not only through the 200-hour SMA, the weekly PP but also through the bottom boundary of an ascending channel. For this reason, the pair is expected to continue to move in the southern direction at least until a meeting with the 61.8% Fibonacci retracement level at 1,278.98.
The Labour Department showed that the US import prices grew at the strongest pace of 0.7% in more than a year in September, due to higher costs of food and petroleum. Meanwhile, underlying inflation marked a modest increase of 0.3% in the reported period. The following report from the Fed showed that the US industrial production gained 0.3% in the prior month amid fading effects of Hurricanes Irma and Harvey, allowing utilities output to bounce back.
US Building Permits and Housing Starts
At 12:30 GMT traders will have a possibility to follow a double macroeconomic data release about the US housing market. From fundamental point of view, this information allows to get better understanding about the temps of growth of the US economy. But from technical perspective, this even usually does arouse especially high interest among market players.
XAU/USD tests ascending channel
Due to release of better than expected data on import prices and industrial production the buck appreciated quite sharply against the gold and has practically reached the bottom boundary of a medium ascending channel. From daily perspective it seems that bears are going to try to drag the pair to the 61.8% Fibonacci retracement level at 1,278.96. On hourly chart such scenario is supported by the 200-hour SMA, which is now located above the current market price. However, in order to reach that target the rate has to pass through a combined support set up by the above channel's boundary and the weekly S1. Although the average market sentiment is 61% bullish, it is unlikely that this support will manage to turn around the exchange rate (unless some unexpected fundamental event will occur).
Hourly Chart
On daily chart the exchange rate is approaching the 100% Fibonacci retracement level, which is secured by the 100-day SMA. A presence of this combined support suggests that the pair might make a short-term rebound. But, in general, it is still expected to reach the bottom boundary of a dominant ascending channel.Daily Chart
Markets sentiment remain bullish
Traders of Dukascopy are bullish on valuation of the gold, as 54% of open positions are long. Accordingly, 54% of pending commands are to buy the commodity.
OANDA traders are bullish, as 63% (+1%) of open positions are long, compared to previous trading day. In the meantime, SAXO bank traders are less bullish, as 59% (+0%) of open positions are also long.