Gold prices could keep climbing to new record highs in the coming days. Manav Modi, Senior Analyst of Commodity Research at Motilal Oswal Financial Services Ltd., points to ongoing geopolitical uncertainty as the main driver. He shares his outlook and specific recommendations for gold investors, including crucial price levels to monitor.
Geopolitical Risks Fuel Safe-Haven Demand
Gold and silver prices surged to record highs this week. Intensifying geopolitical risks and shifting expectations around US monetary policy fueled strong safe-haven demand. Several global events injected both short-term and long-term uncertainty into markets.
Escalating unrest in Iran reportedly led to over 500 deaths. The United States renewed threats of military action and announced tariffs on countries trading with Iran. Venezuela's President Nicolas Maduro faced arrest, adding to the turmoil. These developments supported central bank buying and investor inflows into precious metals.
President Trump also levied tariffs on major European Union nations. He threatened to increase these tariffs after June 1st if a deal to purchase Greenland does not proceed. Despite a relatively firm US dollar, gold and silver maintained their upward momentum.
Key Technical Levels and Market Momentum
Gold prices marked a low around ₹141,000 before reversing sharply. As long as prices sustain above ₹138,000, the momentum remains on the higher side. Immediate support levels now stand at ₹143,000 and ₹140,000.
Bollinger bands, which were previously flat, have expanded with prices on the higher side. This indicates a positive run through expectations. The surge appears more convincing because prices are rising alongside a surge in trading volumes, showcasing buyer strength.
The initial target of ₹145,000 has been achieved. However, any closing above this level could take prices higher toward ₹148,000 and ₹152,000 from a medium to long-term perspective.
Factors Sustaining Gold's Appeal
Geopolitical tensions are not the only factor supporting gold prices. Weak economic data, policy uncertainty, and easing inflation have sustained the metal's safe-haven appeal. The focus this week will shift to US inflation figures, GDP data, and a scheduled speech from President Trump.
These events, combined with updates on the aforementioned geopolitical uncertainties, could keep market volatility elevated. Investors should watch these developments closely as they may influence precious metal prices in the near term.
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.
