Curing some of the investors' disappointment, the price of gold began to record a recovery at the close of trade at the end of last week.
As the US dollar strengthened throughout the week, the price of gold continued to be pushed below the $2,000 level and almost reached $1,950, but slightly rebounded in the last trading session.
The gold price recovery at the end was driven by the market's reaction to Federal Reserve (Fed) Chairman Jerome Powell's dovish statement stating that the central bank does not need to raise interest rates after this.
A significantly weaker US dollar boosted gold prices again and gave investors hope for more positive moves this week.
Examining the XAU/USD chart which measures the value of gold against the US dollar, it can be observed that the price drop last week almost touched the level of 1950.00 before the surge that occurred reached around 1983.00.
The surge has also broken through the Moving Average 50 (MA50) barrier on the 1-hour time frame on the XAU/USD chart as a signal for a change in the price trend for gold.
Slow price movement resumed trading at the opening of the week, but if the rise continues, the price is seen to approach the 2000.00 zone again.
Breaking through that important zone will make investors more optimistic that the price of gold has the potential to rise higher towards the target of 2050.00 again.
However, if the price of gold declines again this week, the support zone at 1950.00 will be tested again.
Failing to bounce back like it did last week, the price is likely to decline to record a fresh 10-week low towards the next target at 1900.00.
