- SWFX traders are 52% bearish
- 51% of pending orders in 1000-pip range are set to SELL the gold
- Commodity price rises to 1,330.00
- Upcoming events: US Retail Sales and CPI
In result of the overall depreciation of the buck, the yellow metal managed to break through the upper edge of a descending channel and reach the 1,330.00 mark. As there almost no barriers left, the surge is likely to continue.
The US producer prices decreased for the first time in more than a year in December, due to falling services costs. The Labour Department stated that the country's PPI slipped 0.1% in the reported month, putting the yearly producer price inflation increase to 2.6% after rising 3.1% in November. Despite the weak correlation between consumer and producer prices, they underline the challenge for the Federal Reserve to reach its 2% inflation goal.
Inflation and Retail Sales
At 13:30 GMT swing traders will be able to observe market reaction on simultaneous release of information on the American Retail Sales and Inflation. According to analysts, the result should be mixed. In any case, this event will be covered by Dukascopy Research team on webinar.
XAU/USD surges to weekly R1
Contrary to prognoses, the upper trend-line of a four-month long descending channel could not constrain the yellow metal from breaking above the 1,230.00 level. It appears that the surge was mainly based on fundamentals, such as signs of the upcoming monetary policy tightening in Europe and unclear picture on global demand prospects from Chinese trade data. For now, the exchange rate has stuck between the weekly and monthly R1. An aggregate of technical indicators points out on continuation of the surge. In case these barriers are broken, the pair will face no obstacles on its way up until the weekly R2 at 1,339.62. In case of rebound, a combination of three moving averages together with the bottom edge of a four-week long ascending channel is expected to provide support.
Hourly Chart
The key achievement of previous trading session was that the rate broke through the upper side of a medium scale descending channel. If the rate manages to secure this result, the next major target should be located at the 1.360.00 mark that represents 2017 high.
Daily Chart
Markets sentiment is neutral
SWFX market sentiment is bullish on Gold, as 52% of open positions are short. Accordingly, the same number of pending commands is set to buy the commodity.
OANDA traders are bearish, as 53% of open positions are short (-2%). In the meantime, SAXO bank traders are 52% bearish (+1%).