GOLD Analysis - Last Week's Golden Rays Dim


 Gold trading fell again at the close of trading last week when it failed to maintain the previous price climbing pattern.

At the beginning of last week, gold managed to show an increase in value in the market following the significant depreciation of the US dollar.

However, the strengthening of the US dollar at the end of the week has dampened investors' hopes of seeing gold continue to shine towards higher levels.

This can be observed on the XAU/USD chart which measures the value of gold against the US dollar with the increase having reached a height of around 1674.50 before the price plunged again last Friday reaching the concentration level of 1640.00.

It also gives a negative signal for the gold price movement when the price is seen to have started to move below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the XAU/USD chart for an early indication of a bearish trend change.

Continuing trading in the Asian session on Monday morning, the price remained slowly flat above the 1640.00 level before starting to see a decline in the price at the beginning of the European session.

The price drop if continued is expected to reach the support zone at 1620.00 which was reached on October 21.

A break above that zone will push the price down to around 1600.00 to test that important zone.

Meanwhile, for the expectation of upward movement in gold prices again, the MA50 barrier will be the initial resistance that will be tested.

A break above that resistance expects last week's high at 1674.500 to be challenged before the price hits a fresh 3-week high.

Next, the resistance level at 1680.00 will be the target after the price increase pattern continues successfully.