The fluctuating movement of gold's value on Wednesday's trading yesterday is increasingly unsettling the yellow metal's investors when the reaction is mixed in the market with published economic data.
The US dollar, which drives gold price movements, initially moved weakly as the expected US producer price index data and retail sales were gloomy heading into the New York session.
But the situation changed when the published data indeed recorded a bad reading and sparked fears of a global recession.
Thus, the US dollar which strengthened towards the close of the New York session yesterday has once again put pressure on the price of gold to fall.
On the XAU/USD price chart, which measures the value of gold against the US dollar, the price has initially risen from the 1900.00 zone.
But after reaching a height of around 1925.00, the price plunged again almost touching the 1900.00 zone again.
Failing to continue the rise, the gold price hovering again below the Moving Average 50 (MA50) barrier level has given a bearish indication for further price movements.
Resuming trading today (Thursday), price movement slowed in the Asian and European sessions above the 1900.00 level and tested the MA50 level.
If the decline continues, the price will drop below the 1900.00 level before creeping lower towards the 1870.00 zone again.
A clear bearish movement of the gold price will expect the price to reach the 1830.00 or 1800.00 level again.
However, if the price remains above the 1900.00 level, the upside may be seen again and the recent high has the potential to be recorded again.
Passing the highs reached this week, the price of gold will target the next concentration zone which is at 1950.00.
