Moderately pigeon rhetoric Janet Yellen, disappointing statistics on US inflation and retail sales, which is the first time since 2010, China's GDP growth of 6.9% in the second quarter and the closure of short positions were the main factors of the gold futures rebound from support level at $ 1205 per ounce.
The key driver of the XAU / USD rally was the weakness of the US dollar.
An important factor in the XAU / USD rally was a change in the mood of major players.
The dynamics of speculative positions in gold
Source: Bloomberg.
Subsequent events showed that speculators were mistaken. In an effort to correct an oversight, hedge funds began to return to the market and some of the recorded profits on short positions was supported by XAU / USD.
In the short term, the fate of gold will depend on the successes in passing the bill on budget reform through the US Congress and the content of the negotiation between Washington and Beijing over trade cooperation. Additionally, the new macroeconomic statistics on the US political risks, the risks of protectionism and the slowdown in global GDP, coupled with the state of the US economy's health are important drivers of change in the value of precious metals.
Technically XAU / USD quotations back to the neckline of the "head and shoulders" pattern. A break in the diagonal resistance increases the risk of continuation of the Northern Expedition directed to $1,265 and $ 1,280 per ounce. On the contrary, the rebound followed by a successful test of support at $1,228 will allow the "bears" to return the lead.
Gold Daily Chart
