Commodities Radar: Gold rises Rs 1,870/10g to new lifetime high. Four reasons why traders could see another upside of Rs 1,300

Domestic gold prices touched another record high of Rs 1,35,496 per 10 gram on Monday, rising sharply by around Rs 1,870 or 1.4% from the last close. While trading remained buoyant amid the growing appeal of ports and bullion investments, rates in India were further supported by the weakness of the rupee.The rupee weakened 0.2% to 90.6475 against the US dollar today, surpassing the previous all-time low of 90.55 on December 12.

Additionally, yellow metal prices on the COMEX were 1% higher at $4,372.90 per troy ounce.Jateen Trivedi, Vice President – Commodity Research at LKP Securities, said the near-term indicators will be key US macroeconomic data, including non-farm payroll data and the core PCE price index. “Any sign of cooling inflation or a weakening in the labor market could reinforce expectations of monetary easing, which would continue to support global bullion prices,” he added.

The INR hitting new lows against the US dollar on a consistent basis is providing support to the bullion rally. Even if COMEX gold witnesses intermittent weakness, the depreciation of the rupee is likely to mitigate downside risks in the domestic market, Trivedi said.

Here are 5 technical indicators you should pay attention to?

1) Major support and resistance

Gold continues to trade on a strong upside structure and is recording fresh higher highs after breaking above the previous consolidation range around Rs 1,32,000 – Rs 1,33,000. The recent breakout candle confirms renewed buying interest, with the price remaining well above the short- and medium-term Amayan averages. The immediate upward momentum remains intact as long as the price remains above the breakout base. The immediate support zone is at Rs 1,33,500 while the key support level is at Rs 1,31,000. Immediate resistance is seen at Rs 1,35,500 and the next resistance level is seen at Rs 1,36,500.

Any dip towards Rs 1,33,500 is expected to attract fresh buying, while a close below Rs 1,31,000 would weaken the bullish setup in the near term.

2) RSI (14)

The daily RSI is near 73-74, indicating strong bullish momentum. Although the oscillator is in the higher zone, it has not yet shown a clear negative divergence. This suggests that momentum is strong, although near-term consolidation or mild pullback at higher levels cannot be ruled out.

3) Bollinger bands

The price is trading near the upper Bollinger band, reflecting a strong continuation of the trend. Band expansion is visible, supporting upside volatility. As long as price remains above the mid-band, the broader bias remains positive, with declines expected to be shallow.

3) moving averages

— EMA 8: Acting as immediate dynamic support near Rs 1,33,800

— EMA 21: Positioned near Rs 1,31,800

Both EMAs are rising sharply and the price is comfortably above them, reinforcing the buy-on-dips structure. The EMA 21 zone aligns closely with the main support area, reinforcing its importance.

4) MACD

The MACD remains in positive territory, with the signal line above the zero line and momentum improving after the breakout. At this stage, no bearish crossover is visible, indicating that the ongoing uptrend remains intact.

Gold trading strategy

Trivedi recommends a buy-on-dips strategy with a buy zone of Rs 1,33,500. He has placed the stop loss below Rs 1,31,000 with targets at Rs 1,35,500/Rs 1,36,500.

“Overall, the trend remains firmly bullish and dips are expected to be used as accumulation opportunities, supported by both technical strength and currency tailwinds,” the LKP analyst said.

(Disclaimer: The recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times.)