Gold investors saw a surge in prices in the yellow metal trading yesterday after the flat movement displayed earlier in the week.
But after the surge, the decline in prices was again shown to be driven by changes in the US dollar trading at different market session times.
The US dollar that weakened in the European session yesterday pushed the price up sharply before in the next session, the US dollar managed to recover and pressure the price of gold to fall again.
The situation is observed on the XAU/USD chart which measures the value of gold against the US dollar.
After leveling off in the Asian session around the 2170.00 level, the price then surged up to touch the 2200.00 high.
As expected by analysts who predict there will be a reaction around that area, the price continues to retreat down as soon as it touches that level.
After the plunge, prices leveled off towards the end of the New York session trading around the 2177.00 level.
Despite the decline again, the price movement is still seen hovering above the Moving Average 50 (MA50) support line which still suggests a bullish price movement to occur.
If the price increase is successfully displayed again, the level of 2200.00 which is the resistance at the time of making the price will be tested again.
If it finally manages to break higher, there is potential for the price to re-reach last week's record high around 2222.00.
However, if the price breaks below the MA50 support, investors should prepare for the risk of a more severe fall in gold.
The price drop target is heading towards the concentration zone at 2145.00 which is expected to invite an attractive price reaction around it.
