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Gold Prices May Trade In A Range Next Week


This week saw some sharp reaction in gold prices, after a stellar run the previous week. From a high of Rs 54,000 per 10 grams, gold prices dropped to Rs 51,230 for 22 karats. The fall in the Indian prices of gold, had largely to do with a sharp drop in prices of gold in the international market.

How gold prices would move next week?

This week saw some selling pressure in gold as investors booked profits at higher levels and also because of a sharp rise in bond yields.


"Gold and silver prices are witnessing huge swings as equities are back in vogue, rebound witnessed in US yields from the lows, positive US economic data, stronger dollar are some the reasons which contributed in the bullion's steep fall in the yesterday's session.

Apart from all this, market participants also cheered as Russia became the first country to announce a Covid-19 vaccine, even though phase 3 trials are going on but the results look quite promising. Just the announcement created an optimistic environment in the market. With all this, concerns of US-China tussle, rapid increase in virus, other uncertainties still hover in the market, supporting the bullish story from a medium term perspective.

Gold Prices May Trade In A Range Next Week

Market participants will keep an eye on the industrial production data and inflation data from major economies; which if reported better than expectations, it could give further volatility to the metals. SPDR holdings fell 0.3% to 1,257.93 tonnes on Tuesday. Broader trend on COMEX could be in the range of $1920-1970 and on domestic front prices could hover in the range of Rs 51,500- 53,500," said Navneet Damani, VP - Commodities Research, Motilal Oswal Financial Services.

It's possible that gold may stabilize at these levels and every dip would be bought into. For investors looking to take fresh positions, it makes little sense to buy, given the sharp rally of the last few months. After all, the mantra to make profits is to: "buy low and sell high".

Read more about: gold gold prices gold rates
Story first published: Sunday, August 16, 2020, 11:23 [IST]
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