- Opened positions on gold are strongly bullish (70% long / 30% short)
- The immediate resistance for the yellow metal is currently located at 1,161
- At the same time, the nearby support for the bullion is placed at 1,154
- Upcoming events in the next 24 hours: Germany CPI (Jun), US Monthly Budget Statement (Jun)
Gold fell on Monday, pushed down by the Euro after an emergency summit of European officials during the weekend to tackle the Greek debt crisis failed to break the deadlock, while the Fed remains on track to hike interest rates this year. Greek Prime Minister Alexis Tsipras has three days to accept and enact extremely tough austerity measures in return to a third bailout worth 82-86 billion euros. In case of a failure, negotiations will begin on Greece's temporary exit from the Euro zone. The news weighed on the Euro, making Dollar-denominated assets such as gold more costly for holders of other currencies.
Meanwhile, The Canadian economy lost fewer jobs last month than expected, while the nation's unemployment rate held steady. A total of 6,400 positions were lost in June, as gains in full-time employment were offset by declines in part-time jobs. Economists, however, had predicted a loss of 10,000 jobs in the reported month and the jobless rate to climb to 6.9%. The number of full-time jobs rose by 64,800, whereas there were 71,200 part-time jobs lost in June.
German annual inflation to be confirmed above zero
Before German Final CPI data is released tomorrow morning, investors will closely watch the US federal budget statistics on Monday at 18:00 PM GMT, as the balance is forecasted to be positive in June due to seasonal factors. In the meantime, the Germany's inflation reading is estimated to be affirmed at 0.3% on the annual basis in June. The ECB's Harmonized Index of Consumer Prices for the Euro zone's largest economy is also expected to be unchanged at 0.1% year-on-year.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
XAU/USD recovered for a third day in a row last Friday with the support from monthly S1 at 1,154; however, the bullion's development was widely muted as investors were awaiting Greek negotiations to take place during the weekend. At the moment gold hovers just around the weekly PP at 1,161. This level is unlikely to play a major role in the short-term, while aggregate technical indicators on all time frames are currently bearish. Thus, we may observe a U-turn back towards the nearest monthly support in the foreseeable future.
Hourly chart
SWFX sentiment strongly bullish toward gold
Meanwhile, OANDA's bulls are in the safe majority with 79.38% of all current positions. Gold's sentiment at there is the second most positive among all major crosses at the moment. Saxo Bank market participants are also optimistic towards to the precious metal, as there are 68% of bullish trades registered in the morning on July 13.
Spreads (avg,pip) / Trading volume / Volatility
Traders, who were asked regarding their longer-term views on XAU/USD between Jun 13 and Jul 13 expect, on average, to see Gold trading just below 1,160 by the end of October. At the same time, 53% of them still believe the bullion will be strongly above 1,150 in three months, while 32% of traders surveyed forecast the bullion to trade in the range between 1,100 and 1,250.