Gold prices saw a significant rebound after hitting a five-week low of ₹61,400 per 10 grams last week. The precious metal bounced back on speculations about a US Federal Reserve interest rate cut, as well as profit-booking in the US bond market. According to Anuj Gupta, the Head of Commodity & Currency at HDFC Securities, the rebound was fueled by these factors.
The trajectory of gold prices will be impacted by several events in the short term. The escalating geopolitical tensions in the Middle East are expected to support the precious metal, alongside the release of the US PCE price index, US Q4 GDP advance estimates, and decisions on interest rates by the Bank of Japan and the European Central Bank, as noted by Sugandha Sachdeva, Founder of WealthWave Insights.
In terms of the price outlook for gold in the short-term, Sugandha Sachdeva stated that the precious metal faces resistance at ₹62,700 per 10 grams and has a support level at ₹61,500 per 10 grams. However, a breach of the key support level could potentially open the path to lower levels in the coming days. On an international level, gold prices are encountering resistance around the $2,065 per ounce mark and seem poised to test lower levels of around $1,965 per ounce.
Despite potential intermittent corrective phases, the long-term outlook suggests that declines in gold could present attractive buying opportunities. This emphasizes the enduring value and potential resilience of gold as an investment option.
Some additional insight:
The rebound in gold prices suggests that investors are still considering gold as a safe-haven asset amidst global tensions and economic uncertainties. The geopolitical events and decisions made by major central banks will continue to impact gold prices, making it crucial for investors to carefully monitor these developments. Furthermore, given the price outlook for gold in the coming days, investors should exercise caution and consider various factors before making any investment decisions.
