The surge of the metal continues. It has reached the 1,330.00 level on Tuesday.
From a technical analysis perspective with the system that Dukascopy Analytics uses, the metal has no resistance and can easily surge as high as 1,340.00 during this week.
However, hourly simple moving averages are indicating that the commodity is overbought. The price is far above the average levels.
This week will have various data releases in various countries that will influence many currency exchange rates. Although, the main event of the week will be the release of the Federal Open Markets Committee Meeting Minutes on Wednesday.
On Wednesday, the already mentioned FOMC Meeting Minutes will be published at 19:00 GMT. They are expected to cause an impact on all USD pairs.
On Thursday, EUR traders will pay attention to the Markit released European Services and Manufacturing PMIs. The German release at 08:30 GMT is the most important.
Later on during the same day the US Durable Goods Orders and Core Durable Goods Orders will be published.
The week will end with the Canadian Core Retail Sales at 13:30 GMT on Friday.
All 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 information watch the weekly Calendar Analysis stream recording.
XAU/USD short term forecast
During Monday's trading session, the yellow metal broke the previously drawn dominant pattern line at 1,325.06. On Tuesday morning, the rate was located at the 1,329.53 mark.
In regards to the near-term future, it is expected that the yellow metal will continue its surge against the US Dollar to the 1,330.00 level.
Note, the chart was fully reviewed, and some corrections were applied to.
Hourly Chart
Note that on the daily chart there is a simple ascending channel pattern, which captures the surge of the yellow metal that has been occurring since November.If the pattern manages to guide the commodity price higher, by the start of April, the commodity price should trade above the 1,350.00 level. Although, on its way upwards the metal will face the monthly pivot point at 1,340.00.
Meanwhile, also all of the simple moving daily averages are far below the metal, indicating that it is overbought.
Daily Chart
More short volume on Tuesday
The total volume of open positions on the Swiss Foreign Exchange indicates that traders are shorting gold. Moreover, this volume has been increasing.
Namely, 64% of open volume on Monday was short. By the middle of Tuesday's trading session 67% was short.
Most likely traders are expecting a consolidating decline in the aftermath of the recent surge.
Meanwhile, the trader set up pending orders in a 1000 base point range around the metal's current price reveal additional information.
Namely, 55% of all orders in that range were set to buy on Monday. These orders were gone on Tuesday, as 67% of orders in the 1000-pip range were set to sell.