Monitoring the chart on the XAU/USD price which measures the value of gold against the USD seems to continue to be stimulated to translate into a devastating plunge in the run -up to the end of November trading.
The strongest resistance barrier previously at the 1800.00 level was easily torn in the European session on Tuesday until the end of the session to record the latest 3 -week low.
The decline also featured a fall to test the RBS (resistance become support) zone of 1780.00 before showing a rise on Wednesday which is expected to be making LH (lower high).
The call by a handful of Federal Reserve (Fed) members to implement tapering measures continues to increase the likelihood for the major central bank to tighten policy even more immediately.
Further strengthening market expectations for the move were strengthened after Jerome Powell is likely to retain his position as Fed President for a second term.
Concerns about the resurgence of the Covid-19 outbreak as well as the strengthening of the greenback dollar at this point continue to put pressure on gold prices ahead of the FOMC policy minutes meeting on Thursday morning.
Further targets will remain on the RBS 1780.00 zone to be broken before expectations are able to track the 1760.00 support zone to remain showing the downtrend pattern since the beginning of the week.
However, the support zone will be assessed following the zone has supported the price spike before and while a lower decline will see the price heading to the support zone of 1720.00.
The probability for the price to start a surge will see the price heading towards the SBR (support become resistance) zone of 1800.00 as well as the expectation that it will test the resistance level of the Moving Average 50 (MA50).
A more significant shadow to make a change in the bullish trend will be seen if the price is able to reach the next SBR zone at 1830.00 before continuing to climb to the top of the height.
