As forecast, gold reached the support of the 200-hour simple moving average, as soon as the 1,600.00 level's support failed and was confirmed as resistance.
On Wednesday, the pair found support in the 200-hour SMA, 1,570.00 level and the new monthly simple pivot point at 1,577.89.
During this week, data can be ignored, as the fundamental background has changed due to the coronavirus.
However, take a look at the list of previously notable events, as the markets will be looking at them to understand the impact of the virus.
XAU/USD short-term forecast
Yesterday, the XAU/USD exchange rate declined to the 200-hour SMA near 1,575.00. During Wednesday morning, the rate reversed north from the given support.
On the one hand, it is likely that the price for gold could recover from the recent drop. In this case the exchange rate would have to surpass the 55– and 100-hour SMAs near 1,610.00.
However, if the given resistance holds, it is likely that yellow metal could consolidate against the US Dollar in the short run. Also, it is unlikely that bears could prevail, and the rate could decline below the monthly PP at 1,577.89.
Hourly Chart
On the daily candle chart, the metal's price has retraced back to the 55-day simple moving average, which was located at 1,588.30. By doing this, the metal has removed some of the overbought pressure, which was present at the end of March.
Daily Chart
Sentiment remains unchanged
Since Monday, the Swiss Foreign Exchange sentiment was 55% long. Namely, 55% of open gold position volume was in long positions.
Traders remained slightly long on the metal despite the recently experienced decline.