Gold prices witnessed a rebound in early trade on Thursday, supported by a softer US dollar and renewed physical demand in the domestic spot market.
On the Multi Commodity Exchange (MCX), gold futures for June delivery rose by ₹560 to ₹71,650 per 10 grams, reflecting a 0.79% gain from the previous session.
Internationally, spot gold edged higher to $2,340.15 per ounce, registering mild gains as the US dollar index weakened below the 105 level, making the yellow metal more attractive for holders of other currencies.
Analysts attribute the price recovery to expectations of a prolonged pause in US interest rate hikes and a pickup in seasonal demand in India, particularly ahead of the upcoming wedding and festive season.
“With the dollar softening and inflation data showing signs of moderation, investors are shifting back into safe-haven assets like gold. Domestic demand is also rising, lending further support,” said Ramesh Arora, Senior Commodities Analyst at Kotak Securities.
From a technical standpoint, traders are closely watching the ₹71,800 resistance level on the MCX.
If breached, the next immediate target is pegged near ₹72,300, while strong support lies at ₹71,100, analysts noted.
Momentum indicators such as the Relative Strength Index (RSI) are pointing towards a positive bias, suggesting the current rally could extend in the short term, provided global cues remain supportive.
The rebound also comes amid cautious optimism in global markets, with investors awaiting key macroeconomic data from the US, including GDP growth figures and core inflation prints, which are expected later this week.
Any indication of easing inflation could further reduce pressure on the Federal Reserve to resume rate hikes.
Meanwhile, jewellery demand across major Indian cities has reportedly seen a surge, particularly as gold prices had corrected earlier this month, prompting consumers to enter the market.
With global uncertainties still lingering and physical demand picking up, gold may continue to find support at lower levels.
However, experts advise investors to remain vigilant, as upcoming US data and central bank commentary could drive short-term volatility.
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