Assessing the price movement on the XAU/USD chart which measures the value of gold against the USD it seems to have returned to highlight the previous ray of light by producing an increase of around 300 pips.
The rise also appears to have started when the price of gold was once again unable to break past the support zone at 1780.00 which had previously failed to break during the December 2021 trading close.
But the price movement seems to be giving an early sign for the price to show a bullish trend signal after the price remained moving above the resistance level of the Moving Average 50 (MA50).
Gold trading continued to take advantage of opportunities as US 10 -year treasury yields fell as well as the release of disappointing US ADP NFP report data for the private sector.
The report will to some extent raise concerns over the publication of the US NFP data report to be released at the New York session (Friday).
The Bank of England (BOE) and European Central Bank (ECB) policy meetings are likely to be the focus of the deck as the impact of the meeting’s decision is likely to shake the gold movement.
Analysts expect that the price of gold will probably rise first to reach the level of 1814.00 or the SBR (support become resistance) zone of 1830.00 before declining again.
However, a stronger surge over the SBR zone is likely to dispel expectations for the price movement to continue to surpass the 1850.00 resistance zone test and remain bullish.
Meanwhile, if the price declines again and continues to overcome the trendline support, the tendency for the price to return to show a downward trend may be more obvious in testing the 1780.00 zone.
