Gold commodity trading in the past week is seen to continue the bullish pattern when the value of gold at the end of the week is declining again.
Meanwhile, the US dollar, which is the driver of the current gold value change in the market, is likely to add pressure this week.
The situation of the spread of Covid-19 in China which is becoming more worrying at the beginning of this week with new deaths reported, has the potential to re-establish the US dollar as a safe-haven currency.
If you evaluate the price movement on the XAU/USD chart which measures the value of gold against the US dollar in the past week, the price has tested the resistance zone at 1786.00 which is the highest level reached for the 3 month trading period.
However, after reaching the latest high in the middle of the week, the price started to show a decline until the close of the week's trading.
The price that also moves below the Moving Average 50 (MA50) barrier on the movement in the 1-hour time frame of the XAU/USD chart is an early indication of a change in the bearish trend for gold.
After breaking through the concentration zone at 1760.00, the price has closed the trade in the last session around the 1750.00 level.
Continuing the early opening of the week in the Asian session this morning, gold price movements slowed down and showed a slight decline and leveled off around 1744.00 heading into the European session.
A further drop in price is expected to test the 1740.00 zone before continuing further down to the 1720.00 focus zone.
However, if the price reflects an increase again, the 1760.00 zone is seen to be the initial zone that will be tested before investors evaluate the change in the gold price trend again.
Breaking through that zone and also breaking through the MA50 barrier would expect prices to be driven higher towards the high zone reached last week at 1786.00 before the target would shift at 1800.00.
