Gold investors were again white-eyed after seeing the price drop at the close of trading last week as the focus turned to the United States (US) NFP jobs data report.
The encouraging reading of the report for January 2024 has triggered a significant strengthening of the US dollar as well as putting pressure on the movement of gold prices.
The US dollar is strong following the market reaction that expects interest rate cuts by the Federal Reserve (Fed) to be more difficult to implement with the current good US labor sector growth.
The strengthening momentum of the US dollar if it continues this week will continue to push the price of gold lower.
On the XAU/USD chart, which measures the value of gold against the US dollar, it was seen plunging last Friday to the 2030.00 zone.
Prior to that, investors had seen a rally in prices that reached a high of 2065.00 as a reaction to the FOMC meeting, but the momentum failed to continue.
Following the reaction to the NFP data, the price of gold plunged below 2050.00 and reached the 2030.00 zone again before slowly closing the last trading session around 2040.00.
A bearish signal for the price when its return movement is below the Moving Average 50 (MA50) barrier line on the 1-hour time frame on the XAU/USD chart.
The price showed a slow decline at the opening of this week's market session and crossed the 2030.00 zone at the beginning of the European session with the expectation of lower declines to continue following last week's momentum.
The zone around 2010.00 to 2000.00 is seen as a target to be targeted on the decline that continues after this.
However, if the price goes up again and passes the 2030.00 zone, it will likely be a new signal for investors.
A change in the bullish trend will push the price back towards the 2050.00 level or the height reached last week.
Next, the resistance zone at 2070.00 will be the focus to be tested on the bullish pattern that is still successfully maintained.
