Gold prices edged lower in Monday's trading yesterday, continuing a bearish pattern at the end of last week.
With the re-strengthening factor of the US dollar at the beginning of this week following the risky market sentiment has pressured the price of gold to trade lower again.
Concerns over the surge in Covid-19 cases and new deaths recorded in China have supported the positive movement of the US dollar.
Looking at the XAU/USD price chart which measures the value of gold against the US dollar, last week the price reached a high of 1785.00.
However, the decline was exhibited again towards the end of the week and the pattern continued at the beginning of the week.
The price remains below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the XAU/USD chart, indicating a bearish movement for gold to investors.
After the price dropped to the level of 1733.00 in the New York session yesterday, the price increase continued today (Tuesday).
Continuing trading in the European session, prices are seen testing the MA50 barrier for investors to assess signals for possible price trend changes.
If the price shrinks again in the next session, the price is likely to go to around 1720.00 for the price to test the RBS (resistance become support) zone.
A lower drop if it continues is seen to go to the 1700.00 zone or even lower to around 1680.00.
On the other hand if the price manages to continue rising higher past the MA50 barrier, the 1760.00 zone will be tested after the initial signal of a bullish trend change.
The rise will continue to retest the 1785.00 resistance zone reached last week before the price of gold recorded its latest high this week.
