Gold Prices Surge in Dubai and Globally
Gold prices continued their ascent in early trade on Wednesday, with the precious metal fetching higher prices in Dubai's markets. The rise in gold prices was mirrored globally, buoyed by a weaker dollar and increased safe-haven buying, setting the stage for potential further gains ahead of the release of minutes from the US central bank's recent policy meeting.
According to data from the Dubai Jewellery Group, 24K gold was trading at Dh245.75 per gram on Wednesday morning, representing an increase from Dh244.5 per gram on Tuesday. Similarly, other variants of gold also opened higher, with 22K priced at Dh227.5, 21K at Dh220.25, and 18K at Dh188.75 per gram.
On the global front, spot gold registered a 0.3% increase, reaching $2,030.38 per ounce at 9:17 am UAE time. This upward movement in gold prices can be attributed to several factors, including a weaker dollar and heightened demand for safe-haven assets amidst global economic uncertainties.
Alex Kuptsikevich, senior market analyst at FxPro, highlighted gold's recent rally, attributing it to a rebound from previous losses triggered by inflation concerns. Kuptsikevich noted that while gold has experienced solid sell-offs earlier in the year, its current rally suggests sustained domestic demand, with investors eager to recoup losses and capitalize on the metal's perceived safe-haven status.
However, Kuptsikevich also cautioned that gold has been following a downward trend since the beginning of the year, with occasional spikes amidst broader declines. He identified the $2,040-2,045 range as a crucial level, indicating that a breach of this range could signal a potential reversal of the downtrend and pave the way for further gains.
Furthermore, Kuptsikevich emphasized the importance of observing gold's behavior as it approaches the $2,050 level, a key resistance point where a reversal occurred in late January. Consolidation around this level would signify a breakdown of the downtrend and potentially pave the way for a sustained rally towards $2,100 and beyond, possibly reaching historic highs.
In summary, gold prices in Dubai and globally continue to trend upwards, driven by a combination of factors including a weaker dollar and heightened safe-haven demand. While recent rallies suggest sustained domestic interest in gold, investors remain cautious amidst prevailing market uncertainties. Observing key resistance levels and price behavior will be crucial in determining the metal's trajectory in the coming weeks, with potential implications for both domestic and international markets.
By: Sahiba Suri
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