Gold prices to see limited upside? Key levels to watch out for this week
Upside in bullion may remain limited as inflation continues to stay above the Federal Reserve’s 2% target. (AI image) (Disclaimer: Recommendations and views on the
Upside in bullion may remain limited as inflation continues to stay above the Federal Reserve’s 2% target. (AI image) (Disclaimer: Recommendations and views on the stock market, or any other asset classes or personal finance management tips given by experts and analysts are their own. These opinions do not represent the views of The Times of India.) Gold price prediction today: Gold prices are likely to see a limited upside because of high inflation in the US, says Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial Services Ltd.Gold inched higher in the previous week, reversing from the recent lows of around $4000 after a weaker US dollar and softer-than-expected US labour market data reduced expectations of an immediate Federal Reserve interest rate hike. The weaker nonfarm payrolls and unemployment figures reinforced the view that the US economy is gradually cooling, easing pressure on the Fed to tighten monetary policy further and improving sentiment towards non-yielding assets such as gold.However, upside in bullion may remain limited as inflation continues to stay above the Federal Reserve’s 2% target, prompting policymakers to maintain a cautious stance on future rate cuts.
Investors will closely scrutinise the minutes of the Federal Reserve’s June meeting for fresh insights into officials’ assessment of inflation, labour market conditions and the path of monetary policy. Market participants will also monitor US inflation expectations and speeches from several Federal Reserve officials for further clues on the timing of policy easing.While lower crude oil prices have helped reduce concerns over energy-driven inflation, broader price pressures from strong AI-related investment, supply chain constraints and adverse weather disruptions remain in focus. At the same time, ongoing geopolitical uncertainties continue to provide an underlying safe-haven bid for gold, although the metal’s direction will largely depend on movements in the US dollar and Treasury yields. Trading activity could also remain volatile this week as markets adjust to liquidity conditions following Friday’s US Independence Day holiday.Gold opened this week on a steady note and continues to trade in a lower-high, lower-low structure on the daily chart. The metal is currently attempting a rebound from the lower Bollinger Band, but the broader bias remains sideways to lower unless it can reclaim the 20-day moving average and break above key resistance.The 20-day Bollinger Bands are placed at: upper band 154,868, middle band (20 SMA) 147,463, and lower band 140,059.
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