More vigorous price movements in the market while awaiting the main event of the week which is the release of the US NFP employment data report for May at the beginning of the New York session soon.
Commodity trading warmed with a more pronounced fall in gold prices yesterday after there were signs for a previous price decline.
Let’s take a look at the price movement on the XAU/USD chart which measures the value of gold against the US dollar.
After the price moved horizontally at the resistance zone of 1900.00, the price has exhibited an aggressive decline in yesterday’s trading with the daily decline recorded around 450 pips.
The decline in the price of gold hit the 1865.00 level before a slow return movement hovered below the 1875.00 level until the end of the New York session.
Continuing in the Asian market session this morning, the price continued a slight decline to the level of 1856.00 before rising again to the focus level of 1875.00 which is a resistance to the current movement of the gold price.
With the re -strengthening of the US dollar over the weekend, the price gave a signal to start a bearish trend moving below the Moving Average 50 (MA50) barrier level in the 1 hour time frame of price movement.
Yet a clearer direction of price movement will be determined after the NFP report is published before investors are ready to resume trading the following week.
If the price continues to decline lower, the support level at 1850.00 will be tested which is seen to be in the RBS zone (resistance become support).
For the next decline, the key RBS zone at 1800.00 will return to focus before the price reaction on that zone will be evaluated by investors.
If the gold price manages to record a rise again, the previous resistance level at 1900.00 will return to the target to be tested before the latest higher rise is likely to head to the level around 1950.00.
