On Wednesday morning, the support of the 55-hour simple moving average reached the yellow metal's price. Previously, on Tuesday, the rate bounced off the resistance of the 1,740.00 mark. In the meantime, a pattern has been spotted on the chart.
In the meantime, a pattern has been spotted on the chart.
On Wednesday, the US Federal Reserve is set to publish a FOMC Statement at 18:00 GMT and announce the Federal Funds Rate. This event is bound to set the tone for the whole global monetary policy.
Click on the link below to find out more about the data releases of this and other currency exchange rates.
XAU/USD short-term forecast
By marking the 1,740.00 level's resistance and connecting the recent higher low levels that have been booked since March 15, an ascending triangle pattern can be observed. Namely, the rate is being squeezed in, as bulls push the metal higher, but bears keep holding at 1,740.00.
In the case of the lower trend line of the pattern failing, the price could look for support in the 100-hour simple moving average near 1,725.00 and the 200-hour SMA near 1,715.00.
On the other hand, if the metal manages to pass the 1,740.00 level, the price could reach the March high level at 1,760.00.
Hourly Chart
On the daily candle chart, the metal could find resistance in the 50.00% Fibonacci retracement level at 1,763.74. This level provided the commodity with support in late November and February.
In the meantime, the June low level of 1,672.39 has been marked on the chart. This level could provide support.
In addition, note that volatility is almost gone. In theory, a lack of volatility eventually results in a sharp move.
Daily Candle Chart
Long sentiment decreases
On Monday, the sentiment on the Swiss Foreign Exchange was bullish, as 70% of open position volume was long.
On Tuesday, 69% of volume was long. By the middle of Wednesday, the sentiment was 68% long.
Note that the gold sentiment is largely bullish at all times due to long term holders.
Meanwhile, in the 1000-pip range around the metal's price the pending orders were 51% to sell the metal.