Gold prices are likely to continue their upside, though there may be some short-term consolidation, according to Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial Services Ltd. Gold has turned decisively positive in the short term, rising to around Rs 155,145 and moving above its recent consolidation range, Modi said.
Price action and technical levels
The price is now approaching the upper end of the recent range, with Rs 157,500–158,000 the key resistance zone for the week, according to Modi. A sustained move above this region could open the way towards Rs 160,000, while failure to break higher may trigger some profit-taking. On the downside, immediate support is placed at Rs 152,000–153,000, followed by the important Rs 147,000 zone.
Modi noted that the 20-day Bollinger Band average sits at Rs 147,008, with the upper band at Rs 157,600 and the lower band at Rs 136,415. With prices trading close to the upper band, upside remains strong but the possibility of short-term consolidation cannot be ruled out.
Using the recent swing from approximately Rs 139,000 to Rs 158,000, the key Fibonacci retracement levels are around Rs 153,500, Rs 150,700, Rs 148,500 and Rs 146,000, according to the analyst. The first retracement zone around Rs 153,500 provides immediate support, while Rs 150,700–148,500 forms a stronger support area.
| Key price levels | Rs |
|---|---|
| Current price | 155,145 |
| Immediate resistance | 157,500–158,000 |
| Upper Bollinger Band | 157,600 |
| Next upside target | 160,000 |
| Immediate support | 152,000–153,000 |
| 20-day Bollinger average | 147,008 |
| Key support | 147,000 |
| Lower Bollinger Band | 136,415 |
Macro drivers: Fed expectations
Gold ended the 10–17 August period on a firm note, with prices holding above $4,300/oz after briefly climbing toward $4,400, as softer US inflation and labour-market data reduced expectations of an immediate Federal Reserve rate hike, Business-Today reported. July CPI was broadly in line with expectations, while PPI came in softer than anticipated, reinforcing the case for the Fed to remain on hold in September. Markets now see only around a one-in-three probability of a September hike.
The weaker US dollar also supported bullion, while renewed strength in the yen and concerns around currency intervention further highlighted gold's role as a reserve asset and hedge against currency risks.
Geopolitical and central-bank demand
Geopolitical developments remained a key source of volatility, with uncertainty over reopening the Strait of Hormuz keeping oil prices elevated at times and raising concerns over renewed inflationary pressure, the report said. China continued to provide a strong fundamental tailwind, with the PBoC extending its gold-buying streak to 21 consecutive months and Chinese gold ETFs continuing to attract inflows.
Weekly outlook
Overall, the weekly bias remains bullish as long as gold holds above Rs 152,000, with Rs 157,600–158,000 as the immediate hurdle and Rs 160,000 as the next upside target, Modi said. A break below Rs 147,000 would weaken the positive setup and could bring Rs 140,000–142,000 back into focus.
Going forward, gold's outlook remains cautiously bullish, with Fed expectations, US inflation and labour data, Hormuz developments and continued central-bank demand likely to determine the next major move, according to Business-Today.
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