The movement of gold prices has invited the disappointment of investors yesterday when the feared situation happened anyway.
The price of gold traded plunged lower yesterday after initially hovering in the critical zone of $1,920.
The attraction towards gold assets is seen to be fading at the moment even though the US dollar was not very strong traded yesterday following the market in a cautious mood waiting for the inflation data of the United States (US) to be published today.
Looking at the XAU/USD chart which measures the value of gold against the US dollar, the price that fell to around 1920.00 at the beginning of the European session yesterday finally slid down to reach around 1908.00.
A little calm in the New York session, the price then closed at the level around 1913.00.
With the bearish signal of the price moving below the Moving Average 50 (MA50) barrier on the 1-hour time frame on the XAU/USD chart, a bearish price is expected.
But the reading of the US inflation data will determine the next direction.
If the strong US dollar pressures the price of gold to fall lower, the price will continue to decline towards the focus target at 1900.00.
Continuing to fall, the price drop target will move to the support level of 1885.00 which was tested in the trading last August.
However, if there is a rebound in the price of gold, the initial resistance that will be the focus is at 192.00 and the price will try to overcome the MA50 barrier.
After success, then the price of gold is expected to rise towards 1930.00 and then the height target at 1950.00 again after the bullish trend change signal.
