Gold commodity trading continued to strengthen at the end of the week after the release of data on economic growth in the United States (US) which continued to close for the second consecutive quarter, making the US dollar continue to move weakly following the negative reaction when the FOMC message.
A reading for the US Gross Domestic Product (KDNK) data recorded a close of 0.9% for the second year and missed expectations for a 0.4% increase from a 1.6% close in the previous quarter.
President Joe Biden remains calm that the US is not yet on the cusp despite signs suggesting the opposite situation, while the fact that Federal Reserve (Fed) Chair Jerome Powell has provided price-boosting support that says it is possible to slow the rate hike to the next term.
Pay attention to the price movement on the XAU/USD chart which measures the value of gold versus the US dollar, the price continued to rise higher after moving horizontally in the 1738.00 zone, maintaining the momentum of the surge after the FOMC message.
The increase in gold prices is seen to be continued in the New York session as a result of the reaction to the release of US KDNK data, breaking the level of 1750.00 and the price starting to flat above that level so that the end of the session and continued to the early Asian session this morning (Friday).
Prices are still holding steady above the 50 Moving Average (MA50) support level after the FOMC message then signaled a bullish movement for gold to continue its rise to higher levels until the end of the week.
The sustained momentum saw a surge in gold prices at the end of the Asian session breaking the barrier at 1760.00 to continue in European trading and is seen heading towards the level of 1785.00 to retest the resistance zone.
For further price gains, higher gains for the yellow metal are expected to return to the 1800.00 support zone to post a fresh 3-week high.
On the other hand, if the price shows an initial contraction below the 1760.00 zone, gold traders will be on the lookout for early indications of a change in the original bearish trend on the price chart.
A dip lower for gold is expected to target the resistance become support (RBS) zone of 1735.00 to be tested, before the decline continues to break above the price support zone this week at 1720.00.
