Gold price prediction today: Will gold prices continue to rally?
Gold has turned decisively positive in the short term, rising to around Rs 155,145 and moving above its recent consolidation range. The price is now approaching the upper end of the recent range, making Rs 157,500–158,000 the key resistance zone for the week.
Gold price analysts predict the precious metal's value may continue its upward trend, although brief consolidation is possible, according to Manav Modi, Senior Analyst at Motilal Oswal Financial Services Ltd. The price of gold recently surged to around Rs 155,145, breaking above its recent range. Currently, the price is near the upper boundary of the range, indicating key resistance at Rs 157,500–158,000 for the week.
A successful break above this level could potentially propel gold prices towards Rs 160,000, while failing to do so might lead to profit-taking. On the downside, immediate support is at Rs 152,000–153,000, followed by the crucial Rs 147,000 zone. The 20-day Bollinger Band average stands at Rs 147,008, with the upper band at Rs 157,600 and the lower band at Rs 136,415.
Given that gold is trading close to the upper band, the outlook remains positive for short-term gains. However, there is a possibility of short-term consolidation. Fibonacci retracement levels suggest immediate support at Rs 153,500 and a stronger support area between Rs 150,700–148,500. The overall bullish sentiment for gold persists as long as it remains above Rs 152,000, with immediate resistance at Rs 157,600–158,000 and the next upside target at Rs 160,000.
A significant drop below Rs 147,000 would weaken the current bullish outlook and bring attention back to the Rs 140,000–142,000 range. In the past week, gold prices ended on a strong note, holding above the $4,300/oz level after briefly reaching $4,400 due to softer-than-expected US inflation and labor market data, which reduced expectations of an immediate Fed rate hike.
July's Consumer Price Index (CPI) remained consistent with expectations, while the Producer Price Index (PPI) showed softer than anticipated results, supporting the Fed's decision to hold off on a September rate increase. Market participants now view the probability of a September hike at around one-in-three. Geopolitical tensions, such as uncertainty over reopening the Strait of Hormuz and concerns over potential renewed inflationary pressures, have contributed to market volatility.
On the positive side, China's ongoing gold purchasing streak and strong inflows into Chinese gold ETFs provide a solid fundamental support. The weaker US dollar and renewed strength in the yen have also bolstered the appeal of gold as a reserve asset and hedge against currency risks. Looking ahead, gold's outlook remains cautiously optimistic, with factors such as Federal Reserve expectations, US inflation and labor data, the Strait of Hormuz situation, and central-bank demand set to influence the next major price movement.
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