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Gold Crashes 6% in a Week Amid Profit Booking, Dollar Strength

Gold prices plummeted nearly 6% over the week, driven by sustained profit booking and a surging US dollar. Analysts note the market is under visible pressure despite ongoing Middle East tensions that had earlier fueled safe-haven demand. Hawkish signals from major global central banks, including the US Federal Reserve, are putting downward pressure on precious metals by supporting higher interest rate expectations. Technical analysis suggests gold is now testing key support zones after breaking its multi-week uptrend.

Key Points: Gold Price Drops 6%: Profit Booking, Dollar Surge Impact

  • Gold down 5.89% this week
  • Silver futures also decline
  • Stronger dollar, profit booking key drivers
  • Geopolitical volatility impacts sentiment
  • Central bank hawkishness adds pressure
2 min read

Gold plummets 5.89 pc this week amid profit booking, dollar surge

Gold prices fell nearly 6% this week due to profit booking and a strong dollar. Analysts see pressure from geopolitics and central bank hawkishness. Get the latest MCX rates.

"Precious metals are set to enter the upcoming week under visible pressure - Analysts"

New Delhi, March 21

Gold prices dipped 5.89 per cent during the week, over successive sessions of profit booking and stronger dollar.

On Friday, MCX gold April futures added 0.23 per cent while MCX silver May futures declined 1.72 per cent. Currently gold futures stand at Rs 1,44,825, while silver futures at Rs 2,27,470 per kg.

The price of 10 grams of 24-carat gold was at Rs 1,47,218 on Friday, down from Rs 1,56,436 seen on Monday, according to data published by the India Bullion and Jewellers Association (IBJA).

Precious metals are set to enter the upcoming week under visible pressure, following a sharp corrective phase amid mixed signals from ongoing Middle East geopolitical developments, analysts said.

While safe-haven demand had earlier supported the rally, recent volatility has impacted investors' sentiment, they added.

Israel's strikes on Iran's South Pars gas field and Iran's retaliatory attacks on energy infrastructure across Gulf nations, has pushed crude oil and natural gas prices, raising the possibility of imported inflation globally.

The US Federal Reserve, the Bank of Japan, the Bank of Canada, and the Bank of England indicated a cautious-to-hawkish approach indicating higher or unchanged interest rates going ahead. The possibility of interest rate hike puts downward pressure on precious metals, market observers said.

The MCX Gold prices are now approaching lower support levels after a sustained multi-week uptrend with resistance now placed near Rs 1,50,000 to Rs 1,52,000 levels while Rs 1,35,000 to Rs 1,40,000 continues to act as a solid demand zone, they noted.

The broader bullish bias of silver remains intact, supported by a balance between safe-haven demand and industrial demand.

MCX Silver extended its sharp corrective decline during the week, and it is testing the Rs 2,20,000 to Rs 2,15,000 demand zone and a recovery toward Rs 2,40,000 is possible if buying strength improves, they said.

- IANS

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Reader Comments

R
Rohit P
Classic profit booking after the huge run-up. The support at 1.35-1.40 lakhs seems strong. If it dips near that zone, it's a solid buying opportunity for long-term investors like me. The fundamentals for gold haven't changed.
A
Aditya G
The article mentions imported inflation due to oil prices. This is the real worry. If petrol prices go up again, whatever we save on gold will be spent on commuting. The RBI has a tough job ahead.
S
Sarah B
Respectfully, while the analysis is good, it feels very short-term trader focused. For most Indian households, gold is a multi-generational asset, not a weekly trade. The 5% weekly drop is noise in a 20-year upward trend.
K
Karthik V
Silver at nearly 2.27 lakhs per kg is still very high! I remember when it was half this price. The industrial demand point is key. With India's solar and electronics push, silver might be the better bet than gold in the long run.
M
Meera T
All these global factors... Fed, Middle East, dollar. Makes you appreciate the simple 'sone ki chidiya' savings our grandparents did. They just bought physical gold every year, no analysis needed. Sometimes old ways are best.

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