After the price of gold fell in trading last Tuesday, the interesting reaction of the commodity's price movement continued to be shown to investors yesterday.
This follows the market's reaction to the statement by Federal Reserve (Fed) Chairman Jerome Powell in Washington yesterday which was seen as failing to provide an additional injection for the strengthening of the US dollar.
The re-weakening of the US dollar gave gold trade some relief from continuing to experience prolonged declines this week.
On the XAU/USD price chart which measures the value of gold against the US dollar, it can be seen that the price was flat in the 1935.00 zone in the Asian session yesterday after a significant plunge in the price the previous day.
The decline was seen further to the lows in the New York session yesterday as markets reacted early to Powell's speech which reiterated a hawkish message for monetary policy.
The price fell to 1920.00 for a recent 3-month low, but bounced back to around 1935.00.
The price is still moving below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the XAU/USD chart and is again showing a bearish pattern today (Thursday).
If the price continues its decline and passes the lowest level reached yesterday, the price of gold could possibly fall to the level of 1900.00.
This level will be a support for the price after the last time the price hovered around that was in the middle of last March.
But if instead gold manages to make a surge and break through the MA50 barrier, this will be an early sign of a change in the upward trend for gold again.
The 1950.00 zone will once again be the target to be retested before heading to the previous resistance levels around 1960.00 and 1970.00.
