Gold trading also worried investors in the New York session yesterday when it displayed uncertain movements following the publication of United States (US) inflation data.
The US annual consumer price index (CPI) reading for May came in at 4.0%, down from 4.9% the previous month, and was the lowest inflation rate since March 2021.
This has increased the tendency towards expectations for the Federal Reserve (Fed) to keep interest rates unchanged at the FOMC meeting early Thursday morning.
The US dollar has traded weakly following the publication of the data.
On the XAU/USD price chart, which measures the value of gold against the US dollar, the price has soared to 1970.00 when the CPI data was published, but it was only an initial reaction.
The price of gold then plunged again until it passed the 1950.00 level until it reached around 1940.00 towards the end of the New York session.
While recovering in continued trading today (Wednesday), prices hovered around testing the 1950.00 level in the European session.
However, the price is still moving below the Moving Average 50 (MA50) barrier level, giving expectations for price movements that remain bearish.
If further declines occur, the price will retest the 1940.00 support zone that has been tested several times since May and early June trading.
If the penetration is lower, the price of gold can fall to around 1900.00 which is one of the previous price focus levels.
However, if gold manages to rise above 1950.00 and then break through the MA50 barrier, the price is able to resume its rise to the 1970.00 resistance level.
Next, the price will test the concentration zone of 1980.00 before the target shifts to 2000.00 which is still waiting to be reached by the price.
