The yellow metal's price was fluctuating in a five dollar range on Tuesday. It attempted to recover, but was quickly forced downwards by the 55 and 100-hour simple moving averages.
The simple moving averages are the main guide from a technical perspective at the moment.
The price of gold is unlikely going to be influenced by macroeconomic data releases this week. However, traders might take advantage of two notable events.
The major event of the week will be the Bank of England rate announcement on Thursday. The rate announcement and the results of the central bank's monetary policy vote will be published at 12:00 GMT.
Another notable event during this week will be the Canadian Employment data release on Friday at 13:30 GMT.
Both of these events are scheduled to be covered by Dukascopy Analytics on our Dukascopy Webinars YouTube channel. The streams start ten minutes before the data release.
For more detailed info and a chance to ask questions watch the weekly calendar analysis by clicking on the link below.
XAU/USD short term forecast
During the previous trading session, the yellow metal was resisted by the 100-hour simple moving average to trade between the 100-hour SMA and the monthly pivot point at 1,308.46. On Tuesday morning, the gold was located at the 1,311.36 mark.
In regards to the near-term future, most likely, the yellow metal will continue the trade between the monthly PP and the simple moving averages to stay at the 1,310.00 level for the rest of the day.
Meanwhile, the 200-hour simple moving average will catch up the monthly pivot point at 1,308.45 to give additional support for the metal.
Hourly Chart
On the daily chart traders can observe the breaking of dominant patterns. The break was caused by fundamental changes in the US Dollar's value.Namely, last week the Federal Reserve announced that the US monetary policy will not be as tight as previously expected.
This revealed that the USD will be more available in the financial markets, and it caused a fall of its value. Due to that reason gold prices surged above the resistance levels.
Daily Chart
Large short sentiment remains intact
Since Monday 73% of trader open positions were short. Traders were shorting the decline, which was occurring in the aftermath of the surge of the yellow metal.
In the meantime, trader pending orders in the 1000-base point range were no longer bullish. They had become neutral on Tuesday. 52% of orders were set to buy.