- SWFX traders are 52% bearish
- 60% of pending commands are to buy the bullion
- The metal's price opened the day's trading at 1,242.07
- Upcoming Events: ISM Manufacturing PMI
The bullion continues on its path lower. On Monday the commodity price confirmed the theory that the long term ascending channel pattern will be broken. As a result of the passing of the support of the long term pattern, a continuation of the decline is expected.
Pending home sales in the United States dropped for the third consecutive month in May, official figures revealed on Wednesday. The National Association of Realtors reported that pending home sales fell 0.8% last month, following April's downwardly revised drop of 1.7% and falling behind market analysts' expectations for an increase of 0.9%. According to Wednesday's data, supply shortages mainly drove the fall. The supply of homes available for sale dropped more than 8% year-over-year in May.
ISM Manufacturing PMI
This Monday there will be only one worth mentioning data release, as the US ISM Manufacturing PMI will influence the short term strength of the US Dollar. The data release is set to occur at 14:00 GMT.
XAU/USD passes long term support
On Monday morning the yellow metal's price fell below the 1,240 mark. However, the main notable detail to the decline of the bullion is the fact that the commodity price has fallen below the support line of the long term ascending channel. This move was expected, as it is consistent with the situation on the charts from a pattern drawing perspective. The bullion is still in a massive scale descending channel. The upper trend line of that channel was reached and the fall of the metal began. Due to the fact that the long term support has been passed an extension of the decline of the yellow metal's price can be expected. However, for the purpose of finding, where short term pauses will occur, market participants should look at the weekly and monthly pivot points.
Hourly Chart
On the daily chart one can observe that the daily simple moving averages are no longer providing support. Namely, during Monday's trading session the 200-day SMA, which was located just above the 1,235 mark was passed. Meanwhile, the daily Bollinger bands are moving lower, freeing up the way for a decline.Daily Chart
SWFX market is slightly bearish
Traders of Dukascopy are no longer neutral in regards to the metal, as 52% of open positions are short on Monday. However, 60% of trader set up orders are to buy the commodity.
OANDA Gold traders have decreased their bullish outlook, as open positions are 66.97% long on Monday, compared to 68.07% on Friday. Meanwhile, traders of SAXO have done the opposite, as 63.60% of open positions are long. Previously 61.20% of the bank's traders were long.
Spreads (avg, pip) / Trading volume / Volatility
Market participants foresee the price of gold being above 1,300 in three months
Traders who were asked regarding their longer-term views on gold during the last month expect, on average, to see the metal around 1,300 by October. Generally, 43% (+2%) of participants believe the price will be above 1,350 in ninety days. Meanwhile, most people see the bullion in the 1,350-1400 range, as 26% (+2%) see the metal in that range.