Gold prices staged a recovery to start the week of July 27, 2026, as geopolitical tensions showed signs of abating, according to Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial Services Ltd. However, gains are likely to be limited ahead of the US Federal Reserve’s policy decision this week.
Price Action and Key Drivers
Gold prices started the week on a positive note as easing geopolitical tensions and a weaker US dollar improved sentiment towards bullion, according to the source. Markets welcomed the temporary pause in hostilities between the United States and Iran after both countries refrained from further military escalation over the weekend, reducing fears of immediate supply disruptions through the Strait of Hormuz and the Red Sea. The de-escalation triggered a sharp decline of more than 5% in crude oil prices, easing concerns over energy-driven inflation and reducing pressure on global central banks to maintain restrictive monetary policies. A softer US Dollar Index also improved the attractiveness of gold for overseas buyers, providing additional support. However, investor caution persists as uncertainty surrounding global trade continues following the US decision to impose fresh tariffs of 10%–12.5% on imports from several trading partners.
Federal Reserve Policy in Focus
Attention is now firmly focused on the Federal Reserve’s policy meeting, where interest rates are widely expected to remain unchanged. Market participants will closely monitor Fed Chair Kevin Warsh’s policy statement and press conference for fresh guidance on the inflation outlook and the future path of interest rates. Investors will also watch upcoming US inflation and labour market data, which could influence expectations for future monetary policy. The direction of the US dollar, Treasury yields and crude oil prices is expected to remain the key driver for gold prices in the near term, while any shift in geopolitical developments could add to market volatility.
Technical Outlook and Key Levels
Gold has shown signs of stabilising after a prolonged corrective phase, with prices rebounding from recent lows and moving back above the 20-day average. The recovery indicates that buying interest is gradually returning, although the broader trend remains cautious as prices continue to trade well below the major highs recorded earlier this year. From a technical perspective, the Bollinger Bands and Fibonacci retracement levels provide context for the current range.
| Indicator | Level (Rs) |
|---|---|
| 20-day SMA (Middle Band) | 143,524 |
| Upper Bollinger Band | 147,576 |
| Lower Bollinger Band | 139,472 |
| 23.6% Fibonacci (from ~97,000 to ~179,000) | 159,700 |
| 38.2% Fibonacci | 147,700 |
| 50% Fibonacci | 138,000 |
| 61.8% Fibonacci | 128,300 |
Gold is currently trading above the middle band, indicating improving short-term momentum. Immediate support is placed at Rs 143,500, followed by Rs 139,500 and Rs 138,000. On the upside, Rs 147,600–147,700 remains the first resistance zone, followed by Rs 152,000 and Rs 159,700. Overall, the outlook remains neutral range-bound. A sustained move above Rs 144,000 could strengthen the recovery and open the door towards the upper Bollinger Band near Rs 147,600, while a move below Rs 143,500 may weaken sentiment and expose prices towards Rs 139,500.
For commodity traders and analysts, the key data releases this week include the Fed policy decision, US inflation and labour market data, which will shape expectations for interest rates and the dollar. Any further geopolitical developments or shifts in crude oil prices will also be critical for gold’s near-term trajectory.
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