Gold trading seemed to be more horrific with an aggressive surge that climbed over 300 pips at the end of last week's trading (Friday) before declining again.
The sharp increase is seen to have received a boost from rising inflationary pressures in recent times and remains an attraction for investors despite the risky market environment.
However, the rise in prices was hampered by the strengthening of the USD following a statement by Federal Reserve (Fed) Chairman Jerome Powell who voiced the implementation of ‘tapering’.
Looking at the XAU/USD price chart which measures the value of gold against the USD it seems to have shown a rise until it managed to break the resistance zone of 1800.00 to reach the level of 1813.00.
However, after reaching that level, the movement of gold price continued to slip to re -hit the RBS zone (resistance become support) 1780.00 and the resistance level of Moving Average 50 (MA50).
The price trend is also seen rebounding after hitting the MA50 level at the end of the session to retest the resistance zone of 1800.00 and continue to the opening of this week's trading session (Monday).
If the rise in the price of gold is successfully maintained, the probability of the price of gold is expected to once again try the level of 1813.00 and it is not impossible for the price to head to the resistance zone of 1830.00.
The resistance zone is also the strongest zone to be torn as the zone has always restrained from higher price spikes since July despite being often tested.
Meanwhile, if the price movement returns to cut the excellent action, the downward trend will see the price re -reach the RBS (resistance become support) zone of 1780.00 before falling more severely.
A drastic decline will see the price plunge into the next RBS zone at 1760.00 and will pass the MA50 barrier level to give an early signal for the price to show a trend change.
