GOLD Analysis – Almost Plunging, Gold Bounces Back to Overcome Highs During NFP

<p>&nbsp;Troubled gold investors in the opening trade of the New York session yesterday when the price of the yellow metal showed a decline to the level of $1,913.</p><p><br /></p><p>Looking back at the publication of the United States (US) NFP employment report last Friday, gold prices surged following the decline in the value of the US dollar.</p><p><br /></p><p>The price then came back flat above the $1,920 zone at the opening of the market earlier this week, but in the New York session yesterday the price surprised when it shrank quite significantly.</p><p><br /></p><p>This is due to the market's reaction to the statement of the Federal Reserve (Fed) officials who see interest rate hikes will continue.</p><p><br /></p><p>However, the tightening phase is said to be nearing its end and this has sparked expectations that the central bank will move to an easing phase after this.</p><p><br /></p><p>On the XAU/USD chart that measures the value of gold against the US dollar, it can be seen that the price first fell to the 1913.00 level before the price bounced back above the Moving Average 50 (MA50) support level in the 1-hour time frame on the chart.</p><p><br /></p><p>The US dollar which returned to trading weak towards the end of the New York session saw prices rise again and close trading around 1925.00.</p><p><br /></p><p>The price increase pattern continued today (Tuesday) until the price was seen to have surpassed the height of last Friday to around 1938.00.</p><p><br /></p><p><br /></p><p>The expected price increase if it continues further will touch the level of 1950.00 which is one of the price concentration zones in the previous trading.</p><p><br /></p><p>The continued depreciation of the US dollar will support gold prices to bounce back to higher levels this week.</p><p><br /></p><p>Meanwhile, if gold prices fall again, the 1920.00 level will again be the target to hit.</p><p><br /></p><p>After an indication of a bearish trend change is detected, the price has the potential to fall lower to around the 1900.00 price support zone.</p><p><br /></p><p>US inflation data that will be published on Wednesday is awaited by investors which can influence the direction of gold's further movement.</p>