GOLD Analysis – Gold Drags Low to Break the $1,912 Level

<p>&nbsp;Gold prices failed to cheer investors on Thursday trading yesterday as the movement pattern remained gloomy.</p><p><br /></p><p>Affected by the published United States (US) inflation data, gold was dragged lower as the US dollar strengthened until the New York session ended.</p><p><br /></p><p>Looking at the XAU/USD price chart which measures the value of gold against the US dollar, the price surge can be seen initially when the data was published at the opening of the session.</p><p><br /></p><p>The weakening US dollar has lifted the price of gold to the level of 1930.00 giving an initial positive impression for investors.</p><p><br /></p><p>However, the joy was short-lived as the price of gold was observed to decline again to reach a recent low of around 1912.00.</p><p><br /></p><p>The price drop below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the XAU/USD chart suggests that the bearish movement pattern will continue for gold.</p><p><br /></p><p>In continued trading today (Friday), prices show a rebound towards the 1920.00 level while testing the MA50 barrier in the European session.</p><p><br /></p><p><br /></p><p>The price decline is expected to continue further past the lowest level reached before heading to the latest target at the 1900.00 concentration level.</p><p><br /></p><p>The last time the price traded at that level was at the end of last June where the price managed to rebound after testing it.</p><p><br /></p><p>As for expectations for price increases, breaking through the MA50 barrier and the 1920.00 level can push prices back to the SBR (support become resistance) zone at 1930.00.</p><p><br /></p><p>Investors also need to be aware of the risk of profit taking activities at the end of the week which will invite uncertainty in price movements in the last sessions.</p>