The gloomy outlook for the gold commodity last week finally shone a ray of hope for investors as the value of the yellow metal surged unexpectedly at the close of trading last week with a surge to over $60 recorded.
This follows the impact of the market's reaction to the United States (US) NFP employment data report published in the New York session last Friday, reflecting a declining labor sector for October.
Thus, the US dollar significantly experienced a decline after initially showing excellent performance from the beginning of the week until the results of the FOMC meeting.
The weakening of the US dollar has opened the door again for the value of gold to soar in the market as investors' hopes for the commodity fade.
On the XAU/USD price chart which measures the value of gold against the US dollar, the price seen had plunged to the 1617.00 support zone on Thursday and then rebounded on Friday following the publication of the NFP employment report.
Giving an early signal before the surge, the price has made an increase past the important level of 1640.00 and also broke through the Moving Average 50 (MA50) barrier on the 1-hour time frame on the XAU/USD chart, signaling an impending trend change.
Then the price continued to soar past the height reached during the reaction of the FOMC meeting around 1670.00 until finally reaching the height of 1680.00.
The 1680.00 level became the focus of the market after the price dropped below the zone and hovered below it for about 4 weeks.
Continuing the trading at the beginning of this week, the price of gold moved slowly in the Asian session connected to the European session and slightly decreased from the 1680.00 level.
If the rally continues and breaks through the 1680.00 resistance, the price is seen to head towards the 1700.00 zone before continuing to climb higher to 1720.00.
On the other hand, if gold 'falls' again this week, the price drop is expected to return to the 1640.00 level before falling lower to the 1620.00 support zone like last week again.
