There was a change in gold trading yesterday and today (Wednesday) as investors began to be alert to the news of the development of the Russia-Ukraine conflict which is heating up again.
After reaching 1,000 days of protracted war, Ukraine on Tuesday yesterday reportedly launched a missile attack using weapons supplied by the United States (US).
Russia has yet to retaliate but markets are now bracing for the situation.
Gold continued its upward trend yesterday but started to show early signs of falling in the European session today.
Price movements are observed on the XAU/USD chart which measures the value of gold against the US dollar.
Since the first session opened at the beginning of the week, the price of gold has shown a climb which shows the recovery of the price from the fall of 2 consecutive weeks before.
The increase continued until yesterday to the Asian session this morning to around 2640.00, but the price started to see a retreat towards 2620.00 in the European session.
While gold is expected to attract investors as a safe asset, the US dollar is also potentially strong as a safe-haven currency and can limit the rise of gold.
Although slightly retreating down, the price movement is seen to be still moving in a bullish pattern that is above the Moving Average 50 (MA50) support line on the 1-hour time frame on the XAU/USD chart.
If the price surge is displayed again, investors will expect an increase to reach the 2670.00 level before targeting around 2700.00.
Escalating war tensions could give the gold price a boost again after a sustained decline since early November.
However, on the other hand, if the price of gold plunges below the 2600.00 level, this will be a warning of danger to investors.
Next, a lower drop in gold prices can be expected to the 2530.00 zone like last week or even lower.
