- SWFX traders are 55% bullish
- 50% of pending orders in 500-pip range are set to BUY the gold
- Pair approaches 200-hour SMA
- Upcoming Events: US Import Prices, Capacity Utilization Rate and Industrial Production
In result of the previous trading session, the exchange rate made a breakout from the rising wedge formation. For this reason, the buck is expected to continue to appreciate against the gold at least until the clash with the 200-hour SMA. But even in the case of a short-term rebound, the pair is still expected to stick with the southern direction.
The Labour Department showed that the US Consumer Price Index edged 0.5% higher in September, the strongest gain since January, which put the yearly rate of consumer inflation to 2.2% in the reported period. Separate report showed a 1.6% increase in the country's retail sales, where its sustainable firmness could cause a cease of low inflation trend and confirm the Fed's stance to raise interest rates anytime soon.
Industrial production
At 12:30 GMT the Bureau of Labor Statistics will make an update about the American inflation prices, which are expected to stay unchanged. Later, at 13:15 GMT the Fed will publish information about the Industrial Production as well as the Capacity Utilization Rate. Unfortunately, none of these releases usually causes volatility in the markets. For this reason, it would be more efficient to follow statements made either by the US or North Korean officials.
XAU/USD breaks from rising wedge
In result of the previous trading session the price of gold decreased by more than 0.86% amid the better than expected New York Manufacturing Index release and lower interest for safe haven assets. From technical point of view, this plunge matched with a breakout from the rising wedge pattern, which formed at the intersection of two ascending channels. The fact that the exchange rate is now located below the 55- and 100-hour SMAs as well as the weekly PP suggests that appreciation of the buck is going to continue at least until the clash with 200-hour SMA near 1,287.05. The bearish scenario looks more plausible also from daily perspective, as it clearly shows how the pair failed to surge above the monthly PP at 1,304.85.
Hourly Chart
In line with expectations, the pair failed to pass through the monthly PP, which might be a sign than traders set a new target, i.e. the 61.8% Fibonacci retracement level at 1,278.96 and, in larger perspective, the bottom boundary of a senior ascending channel.Daily Chart
Markets sentiment remain bullish
Traders of Dukascopy are bullish on valuation of the gold, as 55% of open positions are long. Accordingly, 55% of pending commands are to buy the commodity.
OANDA traders are bullish, as 62% (-5%) of open positions are long, compared to previous trading day. In the meantime, SAXO bank traders are less bullish, as 59% (-1%) of open positions are also long.