- SWFX market sentiment is 70% bullish
- Pending orders in the 1000-pip range are set to buy in 60% of all cases
- Federal Funds rate at 18:00
Gold continued to trade in limbo near 1,200. The commodity price is still set to wait for the Federal Funds Rate at 18:00.
Oil price have increased after US Crude Oil Inventories data release on Wednesday at 14:30 GMT. The one-minute candle gained 21 pips, or 0.30% right after the data release. The crude oil price kept increasing in next hours after the release to continue trading at 71.03 level.
The Energy Information Administration released the US Crude Inventories data that came out lower-than-expected of negative 2.1M, compare to forecasted negative 2.7M.
The United States crude oil price rose to a two-month high after the data release on Wednesday. The data release was bullish according to the market reaction putting the crude oil price above 70 cents per barrel.
US Federal Reserve in focus on Wednesday
The weekly US Crude Oil Inventories will be published at 14:30 GMT. The cover webinar for the release, will start as usual at 14:20 GMT.Meanwhile, the most important data release will be the release of the US Federal Funds Rate. The Federal Reserve is expected to hike their interest rate to 2.25% from 2.00% at 18:00 GMT. The event will be also covered by Dukascopy Analytics live.
XAU/USD short term forecast
In regards to the near-term future, the yellow metal will wait for simple moving averages break-out to push gold to move up towards the 61.80 Fibo or down towards the monthly PP at the 1,1956 mark.
Hourly Chart
The yellow metal on Friday finally reached the resistance levels near the 1,213.00 level on the daily chart. Namely, the combined resistance of a 50.00% Fibonacci retracement level and the 55-day simple moving average were reached.
The levels were expected to get passed. However, they beat the rate down, forcing the commodity into breaking the dominant ascending pattern.
Moreover, it could be observed on the daily chart that the previous support line of the ascending pattern had begun to provide resistance to the commodity price, keeping it lower.
Daily Chart
Long position proportion increases
Swiss traders have decreased their long positions, as 70% of open positions were long on Wednesday, compared to 74% previously. However, this is still a large number of longs.
Meanwhile, most trader set up pending orders are set to buy the metal by closing short positions or opening additional long positions. Namely, 61% of all trader set up orders are set to buy the metal under various conditions.
The expectations of a surge observable on the sentiment of the SWFX contradicts the fact that a rate hike in the US is expected to occur on Wednesday. Namely, if the US hikes their rate, the US Dollar will increase in value. That would beat gold prices downwards immediately upon the hike.