It was not a happy day for gold investors yesterday when they witnessed a more severe price plunge for the opening of the week.
The price of gold dropped lower compared to last week's trading and continuing today (Tuesday), the price has reached the $2,600 concentration level.
This shows a drop of around $200 in the value of gold from a high of $2,790 in just 2 weeks.
The situation was driven by the strengthening factor of the US dollar which limited the increase in gold prices after the end of the United States (US) election and the FOMC meeting last week.
If you look at the movement on the XAU/USD chart which measures the value of gold against the US dollar, the price of gold has continued to decline lower on Monday yesterday past last week's low of 2643.00.
Trading in the New York session yesterday saw the price drop to 2610.00 before the downward trend continued into today.
The price reaction entering the concentration zone at 2600.00-2580.00 will be observed which will give an indication of the direction of further movement.
If the decline is still exhibited without stopping, the next focus zone target to hit is at 2530.00-2500.00.
However, if the price shows a rebound above the 2600.00 zone, some levels will be the focus to test such as 2643.00 and 2670.00.
After clearing the following levels, there will be a return to the potential for gold to shine again with an expected rise towards 2770.00 and the previous record high of 2790.00.
