“The euphoric rally in gold continues, with prices soaring to new record highs of $2,625 per ounce in international markets toward the end of the week. This surge is largely driven by the start of a monetary easing cycle in the US after four years, with the Federal Reserve’s recent super-sized half-percentage-point rate cut renewing the appeal of gold. As US inflation approaches the Fed’s 2% target, the central bank has hinted at an additional 50 basis point rate cut by the end of 2024, further propelling gold’s upward momentum. Gold has been in an uptrend since Q4 2023, gaining over 27% year-to-date.”
Other than the US Fed rate cut factors fueling the gold price today, Sugandha Sachdeva of SS WealthStreet said, “A weakening dollar, renewed tensions in the Middle East, and increasing inflows into global gold ETFs, particularly from Western countries, have further boosted gold prices.”
Sugandha Sachdeva of SS WealthStreet advised a buy-on-dips strategy: “Any correction in gold prices would offer a buying opportunity, and adopting a phased accumulation strategy could be prudent as domestic prices are likely to hit new record highs. Key support levels are ₹72,700 and ₹70,900 per 10 gm mark. For the week ahead, market participants will closely monitor US PCE and core PCE index data, which is the Fed’s preferred inflation gauge, which could further influence gold’s trajectory.
Gold price outlook
“The outlook remains positive, though prices may encounter resistance around ₹74,500 per 10 gm, with some potential for profit-taking. In international markets, gold faces key resistance at $2,680 per ounce level, with support pegged at $2,540 and $2,470 per ounce,” said Sugandha Sachdeva.
