Gold Price Prediction: Underlying Bullish Bias Remains Firm
According to Manav Modi, Senior Analyst of Commodity Research at Motilal Oswal Financial Services Ltd, gold prices currently suggest an underlying bullish bias. The commodities expert has outlined the key factors that will guide gold prices in the coming days along with crucial technical levels that traders should monitor closely.
Fundamental Drivers Supporting Gold
Gold recently breached the significant $5,000 mark last week, supported by softer-than-expected US inflation data. This development strengthened market expectations of potential policy easing by the Federal Reserve and pushed Treasury yields lower, creating favorable conditions for non-yielding assets like gold.
The headline Consumer Price Index (CPI) rose less than forecast, while comments from former Federal Reserve Governor Kevin Warsh reinforced prospects of interest rate cuts. These factors have kept real yields subdued and boosted demand for bullion as an alternative investment.
However, mixed voices emerging from the Federal Open Market Committee (FOMC) meeting minutes have raised some doubts about the pace and timing of potential rate cuts this year. This uncertainty creates a complex backdrop for gold price movements.
Geopolitical and Market Factors
Safe-haven interest in gold has remained firm amid ongoing geopolitical tensions, particularly around the strategic Strait of Hormuz and continuing negotiations with Iran. These geopolitical uncertainties continue to support demand for gold as a traditional safe-haven asset.
Meanwhile, in related precious metals markets, more than 50 million ounces have exited COMEX vaults this year, highlighting robust physical silver demand that often correlates with gold market movements.
Trading ranges have remained relatively tight recently due to thin liquidity conditions caused by holidays in both China and the United States, limiting price volatility in the short term.
Upcoming Market Focus Points
The market focus this week will center on several key developments:
- Comments from President Trump regarding economic policy
- China's market opening and related economic indicators
- US factory orders data
- Producer Price Index (PPI) figures
- Consumer confidence measurements
Technical Analysis and Key Levels
From a technical perspective, Gold Mini Futures on the daily chart are currently consolidating after experiencing a sharp rally. The price action has formed a short-term symmetrical triangle pattern around the 158,000 zone, indicating a pause before the next directional move.
Bollinger Bands analysis shows the price holding above the mid-band level (approximately 153,000), suggesting that the underlying bullish bias remains intact. Meanwhile, the bands have started to contract, signaling a volatility squeeze that typically precedes a potential breakout in the coming weeks.
Key resistance levels to watch include:
- Immediate resistance at 158,000
- Upper band resistance near 165,000 if momentum expands
Important support levels include:
- Key support at 152,000 (mid-band region)
- Stronger support cushions around 145,000
- Lower band support near 140,000
A sustained close above the 158,000 level could trigger trend continuation toward higher targets, while a breakdown below 152,000 may invite short-term corrective pressure on gold prices.
Disclaimer: Recommendations and views on the stock market, other asset classes, or personal finance management tips given by experts are their own. These opinions do not represent the views of The Times of India or Bharat Horizon.
