Gold investors returned to caution earlier this week after celebrating a spirited surge in the price of the precious commodity at the close of trade last week.
Recalling the impact of the United States (US) NFP jobs report last Friday, the US dollar lost its previous strengthening pace and then exhibited a significant decline.
The situation not only gives room for other major currencies to strengthen again, but also gives positive momentum to gold to soar strongly.
The price on the XAU/USD chart which measures the value of gold against the rising US dollar is seen to have reached a high of 1680.00 again.
However, on Monday yesterday, the attempt to continue the increase was seen to be still blocked at the resistance level of 1680.00 before the price bounced back down again.
Continuing trading on Tuesday, the price hovered slowly with the level of 1667.00 being a support for the price.
The price also tested the Moving Average 50 (MA50) level on the 1-hour time frame for investors to get a signal of the direction of further gold price movement.
If the price drops lower, it is likely that the price will be pulled back to the 1640.00 level with signs of a bearish trend change identified again.
The continued lower decline is seen to return to the 1620.00 support zone which has been the focus of the price for the past 6 weeks.
However, if the price surges and crosses the resistance of 1680.00, the bullish movement of the price will lead to the concentration zone at 1700.00.
The continued higher rise will lead to the 1720.00 level to record the latest 5-week high.
