By: DailyForex.com
Although the XAU/USD pair settled lower on the last trading day of the week, the weekly candle was slightly positive. Gold prices rose 0.3% over the course of the week while the market remained within the last 4 weeks trading range. The pair traded as low as 1287.68 after building permits and housing starts data released from the United States beat forecasts but recovered some of its losses due to weak consumer confidence figures.
Friday's data from the Commodity Futures Trading Commission (CFTC) showed that speculative traders on the Chicago Mercantile Exchange reduced their net-long positions in gold to 91634 contracts, from 97956 a week earlier. Speaking strictly based on the charts, trading below the Ichimoku clouds on both the weekly and daily charts indicates that there is more strength and volume behind the bears. However, Ukraine jitters and demand for protection against volatility in the global equities are likely to keep a floor under the gold market.
I will remain neutral on the XAU/USD pair until we climb and hold above the clouds on the daily time frame or break below the 1268 support level. From an intra-day trading perspective, expect to see resistance in the 1298 - 1300 zone. The bulls will need to break through this barrier in order to find another chance to tackle the 1307 resistance level. Beyond that point, the bears will be camping at 1312 and 1318. Support to the downside can be found at 1287/3. If the bears successfully push the pair below 1283, I think we will retest the support at the 1277 level.
