Gold trading was slow at the beginning of the week, yet to surprise investors as the United States (US) inflation data is expected to be published tonight.
A reading of the US consumer price index (CPI) which is forecast to decline for the seventh month in a row could push the US dollar further into decline.
This is due to the tendency of the Federal Reserve (Fed) to slow down their monetary policy which was tightened last year.
In theory on paper, if US inflation decreases, the US dollar will weaken and will have the effect of a jump in the value of gold.
The XAU/USD price chart that measures the value of gold against the US dollar at the beginning of the week still sees the price hovering in the 6-week low zone around 1650.00.
If we examine the price movement in the H1 timeframe, the price remains moving below the Moving Average 50 (MA50) barrier indicating a bearish signal for gold.
The price increase if it happens is seen to face resistance at the 1870.00 level after successfully crossing the MA50 barrier.
Next, the price will return to target the climb to reach the previous 1900.00 concentration zone.
But be alert if the current situation is not in favor of an increase in gold, instead the price plunges to a lower level.
Expectations for a further decline in price will reach the support level at 1830.00 to record a recent low.
Next, the target will shift to the 1800.00 zone on the gold price decline pattern that continues.
