- SWFX traders are 54% bullish
- 58% of pending commands are to buy the metal
- The bullion opened at 1,224.25
- Upcoming Events: US Trade Balance
Economic activity in the US services sector rose unexpectedly last month, official figures showed on Friday. The Institute for Supply Management reported its Purchasing Managers' Index for the services sector climbed to 57.6 in February, while market analysts expected the Index remain unchanged from the prior month's reading of 56.5 during the reported period. Any reading above the 50-point level indicates activity expansion in the services sector. Furthermore, the Non-Manufacturing Business Activity Index came in at 63.6, the highest level since February 2011, up from the previous month's 60.3. Data also showed the New Orders Index increased to 61.2, the highest since August 2015, following January's 58.6. The ISM said 16 out of 18 industries reported growth last month, adding that the share of companies expressing a positive outlook for the future rose markedly last month despite the existing uncertainty in the US economy. Economic activity contracted in the information industry and the real estate, rental and leasing industry in February.
After the release, the US Dollar hit its intraday high of 114.54 against the Japanese Yen but failed to maintain its gains as investors awaited a speech by the Fed Chair Janet Yellen in the day
Upcoming events: US Trade Balance
At 13:30 GMT on Tuesday the US will release their trade balance data. The data release will be covered by the Dukascopy research team. However, the analysts will concentrate on the USD/CAD currency exchange rate during the release, as the US data will be released simultaneously with its Canadian counterpart.
Gold reaches below 1,225 mark
Daily chart: During the early hours of Tuesday's trading session the yellow metal had paused the decline, which occurred during Monday's trading. The bullion stopped just below the 1,225 level and attempted to regain some of its value. However the attempt failed, and the commodity price still remains positioned to fall to the 1,219.20 level, where the 38.20% Fibonacci retracement level is located at. The Fibonacci retracement level is also supported by the weekly S1, which is located at 1,216.60 level.Daily chart
Hourly chart: As it was seen previously, the bullions price bounced off the resistance line of the descending channel pattern. In addition, the decline of the rate afterwards has revealed another channel on the hourly chart, which represents the rates movements inside of the dominant pattern. It seems that the commodity price will remain rather flat until the end of the day, and the fall will resume on Wednesday.
Hourly chart
Trader opinion remains firm
OANDA Gold traders have increased their bullish outlook, as open positions are 65.14% long on Tuesday, compared to 63.14% previously. In addition, traders of SAXO bank have done the same, as 67.24% of open positions are long, compared to 64.25% on Monday.