Gold survived a drop lower yesterday when its value returned to show a rebound in the New York session.
This is due to the reaction to the re-depreciation of the US dollar in the New York session which has given room for gold to cover the losses experienced in the previous session.
Price movements are expected to remain volatile as time approaches the FOMC meeting to find out the policy setting decision by the Federal Reserve (Fed).
The XAU/USD price chart, which measures the value of gold against the US dollar, saw the initial price plunge in the European session back towards the 1900.00 focus zone.
As expected, an attractive price reaction has occurred in the zone where prices have significantly rebounded and managed to close the New York session higher.
The price has reached a high of 1930.00 before closing around 1927.00.
A bullish signal is assessed after the price breaks through the Moving Average 50 (MA50) barrier on the 1-hour time frame on the XAU/USD chart.
If the rise continues after yesterday's surge, the resistance zone at 1950.00 will once again become the focus of price.
Passing that important obstacle will push the price to target at the 2000.00 level to record the latest high level since trading last April 2022.
But if the price of gold plunges again, the price will return to the 1900.00 zone like the drop that happened yesterday.
If the RBS (resistance becomes support) zone fails to hold the fall lower, the decline will continue to reach the 1870.00 zone.
