- SWFX traders are 56% bullish
- 83% of pending orders in 500-pip range are set to BUY the gold
- Gold price recovers to 1,259.00
- Upcoming Events: US Retail Sales, Import Prices and Unemployment Claims
Despite the Federal Funds Rate hike the price of yellow metal increased to the 1,259.00 level. Although majority of pending orders are set to buy, the 200-hour SMA and the monthly S1 might neutralize the further surge.
The Labour Department stated that the US consumer prices slowed growth to 1.7% year-on-year in November, held down by a strong decrease in apparel prices and weak costs of healthcare, which is likely to determine the pace at which the Fed hikes rates next year. Later, the Federal Reserve announced its decision to raise rates to 1.50% from 1.25%, as widely anticipated, but kept future projections unchanged, despite a possible short-term jump amid Trump's proposed cuts of tax.
US Retail Sales
At 13:30 GMT the US Census Bureau will publish an update on the Retail Sales, which are expected to increase to 0.3% from 0.2%. Traditionally, this event causes notable volatility in the markets, although today market reaction might be a little bit lower than usual.
XAU/USD soars to 1,259.00
After forming an inverse head and shoulders pattern and bouncing off from the weekly S2 at 1,235.93 the yellow metal managed to advance by 1.23% against the buck. In daily perspective the surge the is expected to last until the rate makes a new rebound either from the 1,263.63 resistance level or from a combination of the 200-day SMA and the 38.2% Fibonacci retracement level at 1,268.00. However, through the day the soar is likely to be stopped by release of information on the American Core Retail Sales. In this sense, there is a need to take into account the resistance zone formed between the 1,259.00 and 1,259.32 marks and support zone located between the 1,254.00 and 1,253.62 levels, which are likely to squeeze the pair for some time.
Hourly Chart
In result of the yesterday's rate hike, the exchange rate made a turnaround from the 50% Fibonacci retracement level at 1,240.30 and resumed the surge. Such sudden upturn suggests that the three-month long descending channel began to transform into the falling wedge formation. Accordingly, the rest of the month the pair is likely to spend in an upward movement, although in general it is expected to keep moving in southern direction.
Daily Chart
Markets sentiment remain bullish
Traders of Dukascopy are bullish on valuation of the gold, as 56% of open positions are long. Accordingly, 56% of pending commands are to buy the commodity.
OANDA traders are bullish, as 75% (+3%) of open positions are long, compared to previous trading day. In the meantime, SAXO bank traders are less bullish, as 62% (-1%) of open positions are long.