Investors scrutinize gold price movements on the XAU/USD chart, which measures the value of the yellow metal against the US dollar, after a sharp jump in prices last Tuesday.
However, the pattern exhibited seems to repeat the previous movement.
If observed, the price has jumped to the level of 1680.00 on Friday and closed the trading for the week, but the price movement was flat below the 1680.00 zone on Monday when the market opened earlier in the week.
And continuing on Tuesday's trading, the price again surged around 500 pips with the high level almost touching the 1720.00 resistance.
But, once again the price shows a horizontal movement of the price after a surge.
Trading on Wednesday yesterday did not continue to rise, but instead leveled off after 'poking' the 1720.00 level which remains an obstacle for gold prices at the moment.
Still hovering above the 1700.00 zone, the price movement above the support level of the Moving Average 50 (MA50) also still gives an indication for the bullish trend to continue.
The price needs to break the resistance at 1720.00 before the increase will continue towards the 1740.00 level.
Next, the height at 1760.00 will be the price focus to record the latest 11-week high.
However, if the price of gold plunges again below the 1700.00 zone and breaks through the MA50 support, this will be a negative sign for investors who need to be prepared for another fall in the value of the commodity.
For expected decline, the price will test the level of 1680.00 which was previously a resistance zone for the price after it was successfully breached last Tuesday.
A further drop that continues is seen to lead to around 1660.00 or could drop lower to around 1640.00.
