Changes in the movement of gold prices yesterday put a smile back on the faces of investors.
This is because the price of gold showed an increase again on Tuesday after experiencing a significant plunge since last Friday until the opening of the early week last Monday.
The US dollar which lost its strengthening momentum yesterday was taken advantage of by gold to rise by half from the previous fall.
On the XAU/USD chart which measures the value of gold against the US dollar, the price that plunged from last Friday to below 2050.00 has crossed the 2030.00 zone at the beginning of the week to reach the level around 2015.00.
However, on Tuesday yesterday, the price did not continue to decline, but instead recovered to move up past the 2030.00 zone.
The 2038.00 level was reached in the New York session.
The price of gold shows a slow movement to the 2030.00 zone in the European session today (Wednesday) but is still seen to be above the Moving Average 50 (MA50) support line on the 1-hour time frame on the chart.
If the price continues to rise again in the following sessions, it is likely that the concentration level at 2050.00 will be the focus to be tested.
If it passes, the next rise will try to overcome last week's high before heading towards the 2070.00 level.
On the other hand, if the price of gold falls back below the 2030.00 zone, investors have to prepare again for a fall towards the 2000.00 concentration level.
However, the level that was reached at the beginning of the week around 2015.00 should be passed first to continue a more clear bearish movement.
See the XAU/USD price chart image below for your technical analysis reference.
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