In the latest update from Pakistan’s domestic bullion market, the prices of precious metals remained stable on Friday, with 24-karat gold trading at Rs228,550 per tola. This stability comes amid a backdrop of fluctuating global economic indicators and geopolitical concerns, yet the price of gold holds firm, continuing to hover near record-high levels.

KEY FACTORS INFLUENCING THE MARKET

Several critical factors contribute to the current state of the gold market. Anticipation of rate cuts in the United States, increasing demand from China, and ongoing geopolitical tensions worldwide are significant influencers. These elements combine to create a cautious yet steady environment for bullion trading.

The Karachi Sarafa Association, a key body monitoring precious metal rates, disclosed the latest figures. For a more granular look, the price of 10-gram 24-karat gold settled at Rs195,945. Meanwhile, the slightly less pure 22-karat gold was available for Rs179,616 per 10 grams, offering a slightly more accessible entry point for investors and consumers alike.

Not to be overlooked, silver prices also showed no change in the latest session. The rate for 24-karat silver stood at Rs2,600 per tola and Rs2,229.08 per 10 grams, indicating a stable market alongside its more illustrious counterpart, gold.

GLOBAL PERSPECTIVE

On Friday, the Gold price (XAU/USD) experienced an upward momentum, reclaiming a significant portion of its losses from the previous session, and approaching the $2,150 mark, which corresponds to the week’s low point. Despite this positive shift, the price of Gold remains within a trading range established earlier in the week, as investors await further insights on the Federal Reserve’s potential adjustments to interest rates before committing to new market positions. This anticipation sets the stage for the forthcoming Federal Open Market Committee (FOMC) meeting, which is scheduled to commence next Tuesday and last for two days.

XAUUSD posted an intraday high of $2170.13 and intraday low of $2160.68. Gold is currently trading at $2168.03 (2:24pm Friday, 15 March 2024 (GMT+5) Time in Pakistan). A day earlier!

XAUUSD_2024-03-15_14-24-16

TECHNICAL ANALYSIS OF GOLD

Technical analysis suggests that the Gold market is not yet ready to retreat, with support around the $2,150 level playing a crucial role. The recent sideways trading is viewed as a period of consolidation following a notable surge, indicative of an ongoing bullish sentiment. The critical support zone between $2,152 and $2,150 is anticipated to prevent further declines. Should prices fall below this threshold, the next significant support level is projected to be between $2,128 and $2,127, potentially leading to an extension of the pullback towards the $2,100 level, which is expected to serve as a robust foundation for XAU/USD.

Conversely, resistance in the $2,178 to $2,180 range poses an immediate challenge. Overcoming this barrier could propel the Gold price towards the recent high near $2,195. A push above the $2,200 mark may signal a continuation of the upward trend that began earlier in the month.

ECONOMIC DATA

Recent data indicating a hotter-than-expected US Producer Price Index (PPI) has sparked speculation that the Federal Reserve might postpone interest rate reductions. Despite this, market sentiment still largely anticipates rate cuts beginning in June, supported by a decline in US Treasury bond yields, which bolsters the appeal of non-yielding assets like Gold. However, a slight rise in the US Dollar (USD) could temper significant gains in the Gold price.

Investors are now turning their attention to upcoming US economic indicators, including the Empire State Manufacturing Index, Industrial Production, and the Preliminary Michigan Consumer Sentiment Index. These reports, alongside US bond yield trends, will influence USD value fluctuations. Additionally, overall market sentiment is expected to offer short-term trading opportunities in the Gold market. Nevertheless, XAU/USD is positioned for modest declines, potentially ending a three-week streak of gains that culminated in a record high last Friday.

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