Gold prices have recently come under significant pressure, correcting sharply from their all-time highs. After hitting a record of ₹99,358 per 10 grams on April 22 on the MCX, prices have declined by nearly 7%, and now hover near a crucial technical support zone. With market sentiment shifting and international triggers influencing investor behavior, many are wondering: Is this a good time to accumulate gold on dips?
Here’s what experts and analysts are saying about the current gold price movement and what to expect in the near term.
📉 What’s Triggering the Fall in Gold Prices?
According to market analysts, several factors have contributed to the recent drop in gold prices:
- Cooling expectations of US Fed rate cuts have reduced the appeal of non-yielding assets like gold.
- Rising global bond yields are offering better returns, drawing capital away from gold.
- Easing fears of a global trade war and improved economic data have led to risk-on sentiment in equity markets.
As a result, gold, traditionally seen as a safe-haven asset, is facing headwinds in both international and domestic markets.
📊 Technical Pressure Mounts
Gold now threatens to fall below its 50-day moving average for the first time since December 2024. Analysts at Axis Securities note that gold is currently testing the lower end of its 50-day moving average envelope (+3%), which has provided reliable support for previous pullbacks since November.
The firm has identified the period between May 16 to May 20 as a critical window for a potential trend reversal. Internationally, a break below $3,136 could open the door to further declines toward the $2,875–$2,950 range.
In the domestic market, Augmont Research reports that gold prices could correct further, especially after breaching the important double-top neckline at $3,200. The next expected downside range is between $3,000 and $3,050, which translates to around ₹87,000–₹88,000 per 10 grams.
🧠 Expert Views: Pressure in Short Term, Opportunity in Long Term
Renisha Chainani, Head of Research at Augmont, echoes these concerns. “Gold has been under significant pressure due to weakening demand and easing geopolitical tensions. However, we’ve seen some bounce from intraday lows as investors reacted to slower-than-expected progress in the Russia-Ukraine talks and weak US economic data,” she said.
Chainani believes that despite the bearish short-term outlook, the correction could present a buying opportunity for long-term investors, especially as prices approach key support zones.
💹 Support and Resistance Levels to Watch
According to Augmont’s technical analysis:
- Support: ₹92,000 per 10 grams
- Resistance: ₹94,000 per 10 grams
This suggests a narrow trading band in the short term, but with the overall bias tilted toward the downside. Any breach below ₹92,000 could accelerate the fall toward the ₹88,000 mark.
📦 Fundamentals Still Strong in the Long Term
Prithviraj Kothari, Managing Director at RiddiSiddhi Bullions, takes a more optimistic view. “The long-term fundamentals of gold remain intact. The recent correction should be seen in the context of macroeconomic shifts. Investors should be prepared with a diversified strategy, especially if global economies begin to recover faster than expected.”
However, he cautioned that a steep correction could occur if a broader economic recovery gathers pace and demand for risk-off assets like gold declines. In that case, prices could slip toward the $3,000–$3,050 range.
🛒 Is This the Right Time to Buy Gold?
Prathamesh Mallya, DVP – Research, Non-Agri Commodities & Currencies at Angel One, agrees that the recent correction is a potential buy-on-dips opportunity.
He cites several contributing factors for the decline:
- Easing geopolitical tensions (India-Pakistan, Russia-Ukraine)
- Reduced trade tensions between the US and China
- Shifting US inflation expectations
“Our advice is to accumulate gold on dips, especially if prices fall to around ₹90,000 per 10 grams. From there, gold could rebound to ₹97,000 per 10 grams over the next two weeks,” Mallya noted.
📈 Conclusion: Short-Term Caution, Long-Term Opportunity
The current gold price scenario is complex. While technical indicators suggest further downside risk, many analysts view this as a healthy correction rather than the start of a long-term downtrend. For investors with a long-term horizon, accumulating gold around key support levels could offer solid returns as macroeconomic uncertainties persist globally.
However, for short-term traders, caution is advised, especially if global markets continue to firm up and bond yields remain elevated.
Stay tuned to IndiaTimesNewz.com for daily updates on commodity prices, expert insights, and analysis to help you make smarter financial decisions.
Disclaimer: This article is intended for informational and educational purposes only. The opinions and recommendations expressed are those of individual analysts or brokerage firms and do not reflect the views of India Times Newz. Readers are advised to consult with certified financial advisors before making any investment decisions, as market conditions are subject to change and individual financial situations may vary.
