- SWFX market sentiment is 73% bullish
- Pending orders in the 1000-pip range are set to buy in 66% of cases
- The Brexit vote was cancelled, Gold resumed its surge
The yellow metal declined down to the 1,242.00 level, where it found the needed support to continue its surge. Meanwhile, the Brexit vote was cancelled, causing another run to safety, which might have provided the needed momentum for the metal to resume its surge. However, by the middle of the day's trading the metal had already reached the 1,250.00 level.
Latest Fundamental Event
The Automatic Data Processing, Inc. released the US ADP Non-Farm Employment Change data that came out lower than expected of 179K, compare to forecasted 195K.
Ahu Yildirmaz, the Vice President and Co-Head of the ADP Research Institute said, "Although the labor market performed well, job growth decelerated slightly. Midsized businesses added nearly 70 percent of all jobs this month. This growth points to the midsized businesses' ability to provide stronger wages and benefits. It also suggests they could be more insulated from the global challenges large enterprises face."
US PPI incoming at 13:30 GMT
On Tuesday the UK Average Earnings Index and Unemployment Rate are set to be published at 09:30 GMT. This data release usually causes a reaction on the GBP/USD from 15 to 30 pips.Meanwhile, on Tuesday the US Producers Price Index will be released at 13:30 GMT. This data release is set to slightly impact all the pairs that involve the US Dollar. For example, the EUR/USD could bounce around ten pips on the release.
On Wednesday, the US Consumer Price Index change will be published at 13:30 GMT. The event is expected to cause around 20 pip reaction on the EUR/USD.
Note that on Wednesday the biggest move that can be caught will occur on the oil price benchmarks. Namely, at 15:30 GMT the US Crude Oil Inventories data release will cause a sudden move of more than one percent.
On Thursday, the attention will be taken by central bank rate announcements. Namely, at 08:30 GMT the Swiss National Bank will publish their rate and at 12:45 the ECB will publish their interest rate.
The last day of the week will have two notable data releases. At 09:00 GMT the European Manufacturing and Services PMI's created by Markit will be published.
Afterwards, the US Retail Sales data sets will be out at 13:30 GMT. The event might cause a 20 pip bounce.
All of the above mentioned data releases will be covered by Dukascopy Analytics. The events can be watched either on the bank's webinar platform or on our YouTube channel.
XAU/USD short term forecast
During Tuesday's morning hours, the yellow metal broke the resistance of the 38.20% Fibonacci retracement level to trade at the 1,246.67 mark.
In regards to the near-term future, most likely, the yellow metal will trade sideways above the 38.20% Fibonacci retracement level at 1,245.07 mark. In addition, the 55-hour simple moving average will support the gold during the trading session.
On the other side, the gold could depreciate against the US Dollar during today's US PPI data release at 13:30 GMT to push the rate to trade near the monthly R1.
Hourly Chart
Look at the medium term ascending pattern. It could guide the metal up to the 1,260 levels.Although, the surge will be slowed down by the resistance of the 200-day simple moving average, which was approaching the metal's price. Most likely the rate will meet the SMA near the 1,255.00 level.
Daily Chart
Long sentiment remains intact
On Tuesday, 73% of traders continues to be long on the metal. In general, the holders were still holding and some short term traders had opened long positions.
Meanwhile, trader pending orders in the 1000-base point range were set to buy in 66% of cases. It indicated that traders were prepared to buy even more gold in the near future.
In general, holders are still long and short term traders intend to buy more.