Financial analyst Vijay Valecha says a stronger US dollar and rising yields continue to pressure gold and silver, contributing to volatile trading conditions in the gold market.
Dubai: Gold prices recovered in Dubai on Thursday morning, with the price of 24-karat gold increasing by Dh4 to Dh498 per gram, remaining just below the Dh500 mark.
At the opening of trading, 24K gold was priced at Dh498 per gram, compared with Dh494 per gram at Wednesday’s market close.
Other gold categories also recorded gains. The price of 22K gold reached Dh461.25 per gram, while 21K was trading at Dh442.25. Meanwhile, 18K and 14K gold were priced at Dh379 and Dh295.75 per gram, respectively.
In international markets, spot gold gained 0.44% to trade at $4,132.50 per ounce. Silver, however, registered a marginal decline of 0.02%, trading at approximately $60 per ounce.
Stronger Dollar and Higher Yields Weigh on Precious Metals
Financial analyst Vijay Valecha, Chief Investment Officer at Century Financial, said gold and silver continue to face pressure from a strengthening US dollar and elevated bond yields, contributing to unpredictable market movements.
According to Valecha, the US 10-year Treasury yield remains above 5.30%, while the inverse relationship between bond yields and gold prices has strengthened recently amid concerns over fiscal conditions.
Despite the recent fluctuations in precious metal prices, he highlighted positive investment flows into gold-backed exchange-traded funds (ETFs).
Valecha noted that ETFs increased their gold holdings by 81,000 troy ounces during the latest trading session, taking total net purchases for the year to approximately 2.19 million ounces.
This marked the third consecutive session of growth in ETF gold holdings.
He added that purchases by central banks continue to provide underlying support to the precious metals market. Central bank gold acquisitions reached 39 tonnes in August, representing an increase from July.
Key Support and Resistance Levels for Gold
From a technical perspective, Valecha identified the $4,100–$4,120 range as an important support zone for gold prices.
He explained that gold had recovered this level after briefly falling below it during the previous trading session. The range also aligns with an upward-sloping trendline extending from the market lows recorded in June.
If prices weaken further, the next significant support level is expected near $4,050 per ounce.
On the upside, gold could encounter initial resistance around $4,180, close to the previous session’s high.
A further resistance zone is expected between $4,220 and $4,250, where multiple technical indicators converge, including the volume-weighted average price (VWAP) anchored to the September US Federal Reserve meeting and the 20-day simple moving average (SMA).
Valecha suggested that traders watching for potential downward movements could consider short-selling opportunities if gold fails to break above $4,180 and subsequently pulls back.
Under that scenario, the $4,120 level would serve as the initial support area and potential profit-taking target.
Silver Price Outlook: Key Support and Resistance Levels
For silver, the $60–$60.20 range represents an important support zone, while immediate resistance is expected between $61.80 and $62.
A further resistance level is identified at $63, which aligns with the volume-weighted average price (VWAP) anchored to the September US Federal Reserve policy decision.
From a technical trading perspective, analysts suggest that a failure to break above $61.80, followed by a price pullback, could present potential short-selling opportunities.
In this scenario, $60.20 would serve as the initial support level and a potential take-profit (TP) target.
