Like a ‘sleeping’ volcano, the price of gold shocked investors at the start of the New York session yesterday when it displayed a sudden aggressive price movement.
After a flat and slightly bearish price movement throughout the week, the price on the XAU / USD chart soared around 250 pips to the high of 1863.00 as the market focused on US GDP data releases for the 4th quarter of 2020.
However, the price surge did not continue, instead the price plunged back from its surge before the price moved back flat and the price closed around the level of 1842.00.
Market sentiment, which is estimated to be relatively risky over the weekend, has boosted demand for safe-haven assets, not to mention gold.
In the Asian session, the price moved horizontally before a more significant increase in price was seen in the European session re-testing the focus level of 18500.00 but stalled to break it.
If the decline occurs again, the 1835.00 level is seen to serve as a weekly support level that prevents the price from falling lower.
However, if the depreciation of gold continues, the price is seen to go to the price zone around 1820.00 before going to the support zone 1800.00 again.
On the other hand if the price finds strength to jump past the resistance of 1850.00, the high level reached at yesterday's jump will be tested.
Next, the price increase is seen to return to the level of 1875.00 for the price to test the SBR zone (support become resistance).
The level was tested in the previous week but failed to break before the price showed a decline again.
