Diwali 2023, Gold Prices: Buy Yellow Metal For Target Of Rs 68,150 Per 10 Grams - A Technical Outlook

With the start of the Diwali festival this year, it is the right time to invest in gold on the backdrop of a slide in the dollar, geopolitical tensions, rupee depreciation, easing in inflation, central banks purchase of yellow metal and rise in investment demand among others.

Brokerage Religare Broking said that the yellow metal continued its upward journey, trading steadily this year, and it has delivered a return of ~9.70% on domestic bourses so far.

Diwali festival this year begins with Dhanteras on November 10th which is an auspicious day for buying gold as it signifies wealth, prosperity and purity.

On Friday, 22-carat gold in 10 grams increased by Rs 300 to Rs 56,000, as compared to Rs 55,700 of the previous day. Meanwhile, 22-carat in 1 gram to 100 grams are available higher by Rs 30 to Rs 3,000.

Also, 24-carat gold has jumped by Rs 330 to Rs 61,090 per 10 grams, as against the previous day's price level of Rs 60,760. Prices of 1 gram to 100 grams of gold in this carat are up by Rs 33 to Rs 3,300.

Furthermore, 18-carat gold is available at Rs 45,280 per 10 grams up by Rs 250 from the previous day. Prices of 1 gram to 100 grams are costlier by Rs 25 to Rs 2,500 during the occasion of Dhanteras.

This year, gold prices have seen a significant jump. For instance, 22-carat gold stood at 50,600 per 10 grams at the start of January and has rapidly jumped by Rs 5,400 or 11% to reach Rs 56,000 levels. Similarly, 24-carat gold has climbed by Rs 5,890 or 11% from Rs 55,200 at the start of January to Rs 61,090 as of now.

22-carat and 24-carat gold has reached heights of Rs 57,410 and Rs 62,630 per 10 grams in the last week of October as well.

Religare also highlighted that a look at the weekly chart indicates a gradual up-move, with intermediate phases of consolidation in between. Currently, it is experiencing a pullback after a vertical up-move to the record high zone around Rs.61,539/10gms levels.

In its technical outlook, Religare said, "We expect the corrective tone to extend further and likely to find support around Rs.59,300/10gms, which also coincides with the 20 SMA on the weekly chart. Furthermore, prices have bounced back from the 50-week SMA on multiple occasions since the start of the year, currently placed at the Rs.58,400/10gms mark. On the daily chart, gold is approaching the Fibonacci retracement of 38.2% at Rs.59,600/10gms from the recent swing high."

Giving an actionable insight for the short to medium term, Religare's note said, "Participants can accumulate gold in a staggered manner near the Rs.59,300-59,500/10gms range for the upside potential of Rs.62,600/10gms initially and next at Rs.68,150/10gms levels. On the flip side, a decisive break below the previous swing low of Rs.56,500/10gms would subside the positive tone and open the doors for Rs.52,600/10gms levels."

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author or Greynium Information Technologies. The author, the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.