In contrast to the price pattern displayed, gold trading was flat on Wednesday yesterday compared to the drastic plunge in prices that had been displayed the previous day.
On Tuesday, the price of gold plunged sharply below the $2,000 level as the reaction to published United States (US) inflation data strengthened the US dollar and also put pressure on gold.
However, the price plunge did not continue yesterday, instead the price only moved flat throughout the day with the US dollar.
The situation is shown on the XAU/USD price chart which measures the value of gold against the US dollar.
It can be seen that the price plunged through the 2000.00 level but on Wednesday yesterday, the price leveled off with the lowest price level recorded at 1985.00.
Trading remained slow continuing today (Thursday) with price movements hovering around 1994.00 in the European session.
Still moving below the 2000.00 level, the price also remains below the Moving Average 50 (MA50) barrier on the 1-hour time frame on the XAU/USD chart showing a still bearish signal.
A further decline would be expected to occur heading into the next concentration zone at 1970.00.
As for expectations for price increases, the price that crosses the 2000.00 level and the MA50 barrier will be a positive signal for the price to recover from the previous fall.
The price increase is expected to reach the previously tested zone which is around 2030.00 before the higher increase can continue.
