The XAU/USD price movement which measures the value of gold against the USD seems to have provided a surprise with a fatal plunge just after the price reached its latest high of 1854.00.
However, the price initially moved slowly in early trading yesterday (Wednesday) before performing a plunge of over 350 pips when the results of the FOMC meeting were announced.
This situation will certainly push investors to expect the price of gold may remain plummet after the price begins to move below the resistance level of the Moving Average 50 (MA50).
The impact of the statement thrown by the Federal Reserve (Fed) during the FOMC meeting earlier this morning was seen to have supported the greenback dollar to regain the throne as the king of the currency.
The strengthening was entirely further led by a statement from Fed Chairman Jerome Powell who remained taking steps to end bond purchases (tapering) more immediately in March.
Indirectly, this situation continues to influence the Fed to express its intention to raise interest rates and reduce the balance sheet at the next policy meeting.
As a result, analysts issued an expectation that the gold price movement is likely to tend to remain bearish in testing the 1800.00 support zone before continuing to plunge.
While the support zone or can be considered as the lowest level in 2022 around 1780.00 will probably be the next direction if the price remains recording a bearish trend.
But on the other hand, if the price movement makes another jump, then the SBR (support become resistance) zone of 1830.00 may be considered as the first target to be tested again.
A higher surge is likely to drive the price of gold to re -test the current resistance zone at 1850.00 before being evaluated for the next more significant direction.
