- SWFX traders are neutral
- 65% of pending commands are to buy the metal
- The bullion opened at 1,244.05
- Upcoming Events: US Existing Home Sales
US industrial production was unchanged last month, while market analysts anticipated an increase, official figures revealed on Friday. The Federal Reserve reported factory production came in at 0.0% in February, falling behind analysts' expectations for a gain of 0.3%. Meanwhile, January's initially reported drop of 0.3% was revised to a 0.1% fall. However, manufacturing production, which accounts for 75% of overall industrial output, posted a 0.5% increase in February that matched the preceding month's rise. A global economic recovery, stronger business investment in equipment and appropriate inventory levels allowed manufacturers to gain momentum over the last several months.
The advance in manufacturing output was in line with analysts' forecasts. Data also showed utility output decreased 5.7%, following a 5.8% decline in January. The fall was mainly driven by unusually warm temperatures. Mining production rose 2.7% last month, boosted by oil and gas drilling. Business equipment output advanced 0.7% in February, compared to a 0.1% decline registered in the prior month, whereas production of construction supplies increased 1.3% after climbing 1.4% in January. Other data released on Friday showed mood of American shoppers jumped to 97.6 in March, according to the preliminary reading released by the University of Michigan.
Upcoming events: US Existing Home Sales
Wednesday's trading session is set to be a quiet day for fundamental event traders, as there is only one minor data release scheduled for the day. It will be the US Existing Home Sales data, which is set to be published at 14:00 GMT. Moreover, it is highly unlikely that a divergence from the priced in average market forecast will cause volatility in the strength of the US Dollar.
Gold trades near 1,245 level
Daily chart: The yellow metal began Wednesday's trading above the weekly R1 at 1,242.38, which began to provide support by the end of Tuesday's trading. The commodity price is squeezed in between the mentioned weekly R1 and the 50.00% Fibonacci retracement level, which is located at the 1,248.96 level. Due to the persisting bullish sentiment in the markets it can be assumed that the metal will surge, which means that it would pass the retracement level and move in to the next resistance. Above the 50.00% Fibo the closest resistance is the weekly R2 at 1,256.24 and the 200-day simple moving average at the 1,258.57 level.Daily chart
Hourly chart: The hourly chart reveals that the bullion has not yet actually approached the 50.00% Fibonacci retracement level at 1,248.96. The surge was rather stopped from a technical perspective by the upper Bollinger band. However, from a fundamental perspective this might confirm the hypothesis of a profit taking in action.
Hourly chart
SWFX traders are neutral
OANDA Gold traders have decreased their bullish outlook, as open positions are 64.23% long on Wednesday, compared to 65.93% previously. In addition, traders of SAXO bank have also decreased their bullish outlook, as 56.81% of open positions are long, compared to 61.36% on Tuesday.