Gold prices had a solid session today and closed 0.74% higher at Rs. 143,073 after adding Rs. 1,049. The primary push came from falling crude oil prices, which eased inflation concerns somewhat as the Federal Reserve prepared to meet this week.
Traders are keeping an eye on two big things right now: what the Fed does next with interest rates, and ongoing tensions in the Middle East. In the rates market, people are pricing in only a 9% chance of an increase this Wednesday, but an 80% chance of an increase in December. Cheap energy helps moderate overall price increases, yet the conflict in the Middle East is convincing buyers to regard the yellow metal as a necessary safety net.
Indian premiums rise on festive rush, while central banks keep buying
Physical trading in India saw good demand, with local premiums rising to $9 an ounce from $7 last week. Low prices right around the Dussehra festival gave Indian retail buyers a solid reason to step in. In China, premiums remained between $9 and $10 an ounce, although regular jewelery buying remained quiet.
Even so, the People's Bank of China continued its heavy accumulation. The central bank raised its gold reserves to 77.47 million fine troy ounces in September, marking 23 months straight of continuous purchases. However, due to recent market swings, the dollar value of those reserves slipped from $350.08 billion down to $323.52 billion.
Fresh movement was also seen in inventory in major centres. London Vault stocks rose 1.96% month-on-month to 9,821 tonnes as of the end of September. Meanwhile, Swiss export figures rose 6% to 165.2 tonnes – the strongest performance since February 2025 – mainly as shipments to the UK rose to 126.2 tonnes.
Looking ahead, Goldman Sachs stuck firmly to its long-range call, predicting that gold will reach $5,400 an ounce by the end of 2027 as central banks move reserves away from single fiat currencies. However, he noted that an aggressive Fed tone could still shake things up in the near term.
Technical Image: Traders Cover Shorts
From a chart perspective, today's rally looked mostly like short covering. Open interest fell 1.39% to 15,996 contracts, while prices stood at Rs. increased till. 1,049.
On the downside, the initial support sits at Rs. 142,320, with deeper floor priced at Rs. 141,560. On the other hand, the immediate ceiling resistance is marked at Rs. 143,600. If buyers can clear and keep above that mark, the market could move towards Rs. 144,120. Falling below Rs. However, 142,320 may pull the price back to Rs. 141,560.
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Key points for gold traders and bullion buyers
- Inflation vs Rates:Cheap crude helps temper fears of rising inflation, but market bets on a rate hike in December mean traders should remain cautious of the Fed's statements.
- Strong Base Support:Solid festive buying in India and non-stop reserve buying from China ensure a stable floor beneath the sudden selloff.
- Chart levels to watch:Keep an eye on Rs 143,600. A clean breakout targets Rs. Whereas there was a loss of Rs 144,120. Disclosure of Rs 142,320. 141,560.