Around 2:20 pm today, the December gold futures on the MCX were up by over Rs 600 or 0.5% and were trading at Rs 1,21,846 per 10 grams. Meanwhile, the bullion metal rose 0.7% or by $27 per troy ounce and was trading at $4,024 on the COMEX.
Domestic gold prices have corrected 8% or by Rs 10,000 per gram from their all-time highs of Rs 1,32,294.
Commenting on the current trends, Jateen Trivedi, Vice President and Research Analyst at LKP Securities, said that gold is adjusting to positive trade developments between the US and China, which have slightly improved global risk sentiment. However, the metal continues to price in prior tariff effects and geopolitical risks that limit deeper corrections, he added.
US ISM Manufacturing and Non-Manufacturing PMI data will guide sentiment on US growth, and stronger data could strengthen the dollar and further pressure gold prices, Trivedi said.
Among domestic factors, the rupee’s weakness continues to lend cushion to MCX gold, though domestic upside remains capped if international cues stay risk-positive, the LKP Securities analyst warned.
Five technical indicators to watch out for before making a trade:
1) Key support & resistance
Gold December futures faced resistance around Rs 1,23,550 – Rs 1,23,950, failing to sustain higher levels and slipping towards Rs 1,21,200. The short-term structure has turned slightly weak as prices trade below mid-range.
Key supports are seen at Rs 1,20,172 and Rs 1,19,470, while resistance remains at Rs 1,22,485 – Rs 1,23,550. Price action suggests a sell-on-rise tone as long as gold remains below Rs 1,22,500.
2) RSI
The RSI is hovering around 50, indicating neutral momentum with a mild bearish bias. The indicator’s inability to cross 55 hints at limited buying strength, supporting the short-term corrective view.
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3) Bollinger Bands
The price is consolidating between the middle and lower Bollinger Bands, suggesting a weak undertone. A close below Rs 1,20,800 could push gold towards the lower band zone near Rs 1,19,400 – Rs 1,17,560, while resistance on the upper band lies near Rs 1,23,950.
4) EMA 21 & EMA 8
The EMA 8 is now below EMA 21, reflecting short-term weakness after multiple failed attempts to sustain above Rs 1,22,500. Unless gold decisively moves above the EMA cluster (Rs 1,22,400 – Rs 1,22,600), rallies may continue to face selling pressure.
5) MACD
MACD has flattened near the zero line with no clear bullish divergence, indicating loss of upward momentum. A negative crossover on higher timeframes may strengthen the bearish tone if prices stay below Rs 1,22,000.
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Gold trading strategy
Trivedi recommends a ‘Sell on rise’ stance near Rs 1,21,300 with a stop loss of Rs 1,22,500 and targets of Rs 1,20,000 – Rs 1,19,400.
A bounce above Rs 1,22,500 will offer opportunities to re-enter shorts for positional traders.
(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)