Examining the price movement on the XAU / USD chart which measures the value of gold against the US dollar saw the increase displayed last week almost touch the 1850.00 level in the SBR zone (support become resistance).
The New York session on Friday saw a bearish attempt to move lower below the Moving Average 50 (MA50) support level on the 1-hour price movement but failed to move lower before closing trading around 1838.00.
Price movements in the Asian session early this morning slowly opened trades this week calmly. However, calm water do not think gold does not do things!
The European session saw prices plummet around 200 pips as of 5pm local time.
While awaiting further developments on vaccine issues and economic stimulus packages in the United States (US), the Brexit crisis was the first factor to shake the market earlier in the week.
Investor concerns in the market have led to a strengthening of the US dollar safe-haven currency.
In addition, a factor in strengthening the US dollar was the US report that it would impose the latest sanctions on about 14 Chinese officials while Beijing reacted against the move.
The bearish move on the XAU / USD chart is seen heading towards the 1800.00 focus zone which will be the support level for the price from falling lower.
If the price continues to decline below that level, further decline will return to test the support zone 1765.00.
On the other hand, if the price resumes last week's increase, the SBR 1850.00 zone will be tested and the price reaction on that zone will be evaluated by investors.
If the price manages to pass a higher rise, then the level of 1875.00 will be the target destination which is a resistance in last November's trade.
