Gold Price Prediction: Market to Remain Range-Bound in Coming Days
Gold prices are likely to stay within a narrow range in the upcoming period, according to Divya Mandaliya, Commodity Research Analyst at Anand Rathi Share and Stock Brokers Limited. This forecast comes as the precious metal's recent price action reveals a shift in market drivers, with liquidity conditions taking precedence over its traditional role as a safe-haven asset.
Geopolitical Tensions and Market Response
Escalating geopolitical tensions in the Middle East, particularly involving Iran and the Strait of Hormuz, initially pushed gold prices higher, resulting in a gain of over 4% early last week. However, this upward movement proved short-lived, as prices reversed course at the start of this week, stabilizing near $4,630 per ounce. The muted response to rising geopolitical risks is notable, with gold struggling to attract sustained inflows despite escalation rhetoric from figures like Donald Trump, who issued explicit deadlines and threats to critical infrastructure.
Instead, tighter liquidity and broader market stress have triggered intermittent selling, as investors raise cash and meet margin calls, diluting gold's traditional defensive role. This dynamic highlights how macro factors are now the dominant driver of gold prices.
Macroeconomic Factors Influencing Gold
Elevated US Treasury yields and a firm US dollar continue to reinforce a "higher-for-longer" interest rate environment, which caps upside potential for bullion. Concurrently, oil prices above $110 per barrel are sustaining inflation expectations, creating a backdrop where gold retains structural support but faces near-term constraints from these headwinds.
Positioning indicators show mixed signals but early signs of stabilization. Gold-backed exchange-traded funds (ETFs) have recorded their first weekly inflow since the onset of the conflict, pointing to selective dip-buying at lower levels. However, this activity has yet to evolve into a broader or sustained trend, indicating cautious investor sentiment.
Technical Analysis and Price Outlook
From a technical perspective, gold is expected to remain in a broad consolidation phase following the recent correction from highs. Analysts recommend a sell-on-rise strategy within the range, with only a sustained break above $4,800 per ounce likely to revive upside momentum toward $5,000. Immediate support levels are identified at $4,550–4,500 per ounce, while resistance is near $4,750-4,800.
For silver, the outlook suggests a sell-on-rise bias within its range, with volatility likely to remain elevated. Silver is underperforming gold and continues to trade in a consolidation phase with a slight downside bias for this week. Immediate support is at $69-70 per ounce, while resistance lies at $74–76. A sustained move above $76 is needed to improve the near-term outlook for silver.
Despite ongoing volatility, downside risks for gold appear limited. Structural factors such as geopolitical uncertainty, sticky inflation, and steady central bank demand should provide a floor for prices, even as macro headwinds restrain a sustained breakout. The interplay between geopolitics and rate expectations will largely drive direction, with easing tensions and softer oil potentially reviving rate-cut hopes to support prices, while persistent risks and elevated oil may keep rates higher for longer, capping gains.
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.
