After experiencing a fall at the beginning of the week, gold trading on Tuesday yesterday appeared to be flat in a small price range.
There was a slow price fluctuation with gold also influenced by changes in the US dollar following the reaction to the published data.
Higher increases were seen today (Wednesday) compared to yesterday’s levels as the market’s focus is now on the United States (US) consumer inflation data to be published in the New York session tonight.
Observing the movement of the XAU/USD chart which measures the value of gold against the US dollar, the price hovered between the range of 2677.00 to 2660.00 yesterday.
Examining today’s price movements, the increase was successfully displayed from the level of 2670.00 to surpass the level of 2690.00 as trading moved to the beginning of the European session.
A bullish signal was observed with the price movement being above the Moving Average 50 (MA50) line on the 1-hour time frame on the chart.
A higher increase if continued is seen to test resistance at the height reached at the end of last week around 2697.00.
Next, the gold price will head back to the 2700.00-2720.00 zone which was an important resistance tested in November and December trading.
However, if the price changes to make a decline again, a drop below the 2670.00 zone will indicate that the decline will be extended lower.
After showing a bearish signal, the price is at risk of falling back to the 2600.00 zone as tested at the end of last December.
