Gold prices stabilized as concerns over tensions in the Middle East diminished, with investors gearing up for forthcoming U.S. economic data expected later in the week, on Wednesday. This data could provide insights into the Federal Reserve’s trajectory regarding interest rates.
At 9:20 a.m. ET (1320 GMT), spot gold saw a slight decline of 0.1% to $2,318.50 per ounce, having reached its lowest point since April 5 in the previous session. Similarly, U.S. gold futures dropped 0.2% to $2,336.50. Spot silver also experienced a slight dip of 0.3% to $27.20.
Since reaching a record high of $2,431.29 on April 12, bullion prices have retreated by over $100.
Back home, Gold prices saw a slight increase on Wednesday, April 24th. Gold futures for June expiry on the Multi Commodity Exchange (MCX) recorded a modest uptick of 0.15% per 10 grams.
According to reports, in a span of only 10 days, gold prices have seen a significant decline of ₹2,900, now standing at ₹71,065 per 10 grams compared to the recent peak of ₹73,958.
Amid the conflict between Iran and Israel, safe-haven buying drove gold prices to their all-time high of ₹73,958 on April 12th.
However, on Tuesday, gold June futures settled flat at ₹71,014 per 10 grams, marking a minimal loss of 0.02%. Similarly, the silver May futures contract concluded ₹21 or 0.02% lower at ₹80,657 per kilogram.
“The current decline in gold prices presents an opportunity for investors, but the approach should be cautious. While gold is considered a safe-haven asset, it’s essential to assess whether to adopt an aggressive or conservative investment strategy, especially after a strong bull run. Prices are currently trending, and investors often wait for prices to cool off before entering the market. However, geopolitical tensions and ongoing global uncertainties continue to support gold prices, making it an attractive long-term investment,” Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities, told Livemint.
Should you invest or not?
Experts recommend investors to accumulate gold at these levels as interest rates are expected to infuse liquidity into the markets.
“Immediate support for gold is around ₹70,000, with the next support level near ₹68,000. Investors should consider accumulating gold at these levels, as interest rate cuts are expected to infuse liquidity into the markets, supporting the longer-term outlook for gold. Overall, a 4-5% dip from the current levels presents favorable buying opportunities for investors,” Trivedi added.
Gold prices have corrected more than 5% from its all time high of Rs. 73,958 per 10gm, on profit-booking, signs of de-escalation in the middle-east tension, oil price are again down below $90, and renewed buying the U.S. dollar and treasuries on prospects of delay in the interest rate cuts by the U.S. Federal Reserve.
“Going ahead, we may see some more correction of about 2-3% between Rs. 68,500-69,000, I feel those will be ideal level to again start buying gold and accumulate for higher target as the up-trend still remains intact. The key factors to watch in the coming sessions will the inflation and other data from across global markets, buying among ETF investors, and the U.S. dollar moves,” Pranav Mer, VP – Research (Commodity & Currency) BlinkX and JM Financial, told Livemint.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it’s all here, just a click away! Login Now!
