- Opened positions on gold are bullish (63% long / 37% short)
- The immediate resistance for the yellow metal is currently located at 1,178
- At the same time, the nearby support for the bullion is placed at 1,162
- Upcoming events in the next 72 hours: Euro zone Services PMI (Jun) and Retail Sales (May), Germany Factory Orders (May), Greece Referendum, UK Services PMI (UK)
© Dukascopy Bank SA
Gold remained steady above its lowest level in more than three months on Friday, as somewhat downbeat US data tempered expectations for the US interest rate hike in September and hurt the Greenback. For the week, the precious metal is still down 0.7%, marking its second consecutive weekly decline due to the Dollar's strength supported by the Greek debt crisis. SPDR Gold Trust, the top gold-backed exchange-traded fund, said its holdings dropped 0.25% to 709.65 tonnes on Thursday, close to a near-six-year low reached last month.
American employers continued to add more than 200,000 jobs for a third consecutive month in June, while the US unemployment rate declined more than expected. US non-farm payrolls rose by 223,000 in June, following the downwardly revised 254,000 a month earlier, according to the Labor Department. The jobless rate slid to 5.3%, down from 5.5% the prior month, marking the lowest rate since April 2008.
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US Bank Holiday to refocus attention on Europe today
Before the US Independence Day is taking place tomorrow, the country is having a holiday on Friday; therefore, no news is expected from the world's largest economy today. At the same time, five biggest economies of Europe are releasing the Services PMI indicators in course of the day, with Spain coming first at 7:15 AM GMT and the UK ending the data flow at 8:30 AM GMT. Besides fundamentals, market participants will closely watch the results of the Greek referendum on Sunday.Read More: Fundamental Analysis
XAU/USD develops inside bearish wedge pattern on daily chart
Since the second quarter of 2013, the bullion has been developing inside the falling wedge pattern, meaning that trading range is decreasing as time goes on. Two pattern's boundaries are represented by the upper trend-line around 1,270 and pattern's support at 1,115. Among recent developments, in March 2015 the yellow metal resumed gaining value, even without touching the lower trend-line, but the growth stalled beneath the 2009 high at 1,230. In the foreseeable future the rally is likely to be limited and the bullion should be driven by the 200-day SMA around 1,200, which has a slight bearish bias. Some short-term gains in the direction of the long-term downtrend (1,270) are not completely off the table, but bears are eventually going to overtake a lead and drive the metal back to the south. The overall negative tendency for gold seems to be the case in the long run, while at the end of this year the precious metal should to consolidate around 1,150, in case the present trend persists.Daily chart
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This week's behaviour of XAU/USD cross is very similar to the one it showed last week. From Monday the cross was declining for four days in a row and today it attempts to rebound. Yesterday, however, gold reached the new June low at 1,157 after US NFP, but bounced back afterwards and closed the trading session at 1,166. Supported by the weekly S1 at 1,162, the bullion will be expected to advance in the short term. The immediate resistance is in turn located around 1,180 (monthly and weekly PP, 2013 low, 20-day SMA).
Hourly chart
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SWFX long open positions retreated further
Meanwhile, OANDA's bulls are in the safe majority with 83.19% (+3%) of all current positions. Gold's sentiment at OANDA is the second most positive among all major currency pairs at the moment. Saxo Bank market participants are also optimistic with respect to the precious metal, as there were 72% (+2%) of bullish trades registered by 5:30 AM GMT on July 3.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Jun 3 and Jul 3 expect, on average, to see gold trading around 1,175 by the end of October. At the same time, 50% of them believe the bullion will be above 1,200 in three months, while 27% of traders surveyed forecast the precious metal to trade in the range between 1,050 and 1,200.
© Dukascopy Bank SA