Market risk sentiment at the beginning of the week gave the US dollar an advantage to maintain its strengthening as a safe-haven currency.
This will also maintain the momentum of the US dollar which managed to dominate again in the market after the surprising reading of the US NFP employment data report with a strong reading compared to forecasts.
The effect of the strengthening of the US dollar is seen to put pressure on gold commodity trading when the price has shown a plunge of up to $100 since last week.
It can be observed that the price movement on the XAU/USD chart that measures the value of gold against the US dollar saw that the price had reached the 1950.00 zone last week.
But the price failed to last long at that high level before investors had to accept the losses experienced again.
The price of gold has jumped past two critical zones which are at 1900.00 and also 1870.00.
However, following the trading at the beginning of the week yesterday, the price of gold was seen hovering slowly in the 1870.00 zone until today (Tuesday).
Although flat, the price moving below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the XAU/USD chart still signals bearish trend movement.
The price of gold is likely to be expected to drop lower with the latest lowest target being towards 1830.00.
In fact, the price could fall lower to around 1800.00 if the US dollar continues to strengthen.
However, if the situation changes, the gold price spike will happen again with the closest level to be reached is at 1900.00 first.
Next, the climb will continue to reach the 1950.00 resistance zone again before surpassing last week's record high.
