The US dollar failed to perform well in the trading session earlier this week, instead continuing its decline last week and making the gold commodity soar around 180 pips from the Asian session before making a further decline in the European session.
In the middle of the New York session, the US dollar began to strengthen slightly due to the decline in Wall Street market profits making investors again wary of risky market sentiment.
Among the factors seen limiting the strengthening of the US dollar was investor sentiment which reduced expectations for a 100 basis point hike by the Federal Reserve (Fed), but a 75 basis point hike remained the central bank's top choice.
The price movement on the XAU/USD chart which measures the value of gold against the US dollar still saw the price flat above the 1700.00 support zone with the rise displayed yesterday testing the resistance at the 1720.00 zone.
As analysts expected, gold prices struggled to continue rising past those key zones before declines were displayed until the end of the New York session.
As of today's (Tuesday) trading, the price has moved below the Moving Average 50 (MA50) barrier level on the 1 -hour time frame on the XAU/USD chart giving an early signal for bearish movement.
Still, the price showed a slight increase even at a slower rate of movement before investors expected a more aggressive movement in the next session.
If the price manages to continue rising, the 1720.00 level is still a resistance to test the price before continuing the higher surge after the bullish trend change signal again.
The next price increase is seen to lead to the focus zone at 1760.00 before the higher target is to reach back to the level of 1800.00.
On the other hand if the price starts to show signs of resuming the previous bearish treand, investors should be prepared for a more severe fall of gold to post the latest lows again this week.
The decline will test the 1700.00 support zone before continuing further decline to the latest target towards around the 1680.00 zone which is the price support level in March 2021 trading.
