The fall of the U.S. dollar and U.S. bond yields have provided an opportunity for gold trading to rise higher than the one -month low hit this week.
The Federal Reserve (Fed) has raised interest rates to 1.75% in its latest policy meeting yesterday (Thursday) and also said that US economic growth is a sign of the risk of a recession.
10 -year US bond yields, which fell lower to 3.18%, also caused the US dollar to continue to weaken after an interest rate hike by the Fed did not boost the value of the currency's king.
However, investors remained cautious for the movement of the US dollar as market analysts remained expecting that the US dollar could rebound with signals from the hawkish Fed by implementing such an aggressive rate hike.
On the XAU/USD price chart which measures the value of gold against the US dollar, the price was seen to have exhibited a surge in late -European session trading yesterday after an early decline occurred at the beginning of the session hitting a daily low of around 1816.00.
The trend change was also assessed by gold investors after the price failed to break the Moving Average 50 (MA50) support level on the 1 -hour time frame signaling to see the gold commodity to continue rising to higher levels.
The price surge until the end of the New York session, had reached a high of 1857.00 before the price declined again in trading that continued into the Asian session this morning (Friday). A rebound in prices was seen in the European session, however investors were more cautious with the expectation of more attractive movements in the New York session soon.
If the price increase manages to continue beyond the 1850.00 zone, it is seen that the 1870.00 resistance zone that was tested last week will be the target again.
A higher rise that passes the resistance zone will record the latest 6 -week high for gold with the next price target to head to 1900.00.
On the other hand, if the rise fails to continue and the price falls back below the 1830.00 level, the price focus will be directed to 1810.00 again before the lower decline is expected to reach the 1800.00 focus zone.
The drop in the price to the 1800.00 zone will record the latest 4 -week low for gold trading.
