Gold prices experienced a slight decline, closing down by 0.19% at Rs 137,742, as investors adjusted their positions in anticipation of futures selling associated with the annual commodity index rebalancing. Additionally, a stronger U.S. dollar exerted further pressure by increasing the cost of the metal for international purchasers. The dollar remained close to a one-month peak as markets evaluated mixed economic indicators from the U.S. in anticipation of the nonfarm payrolls report, with job openings declining to a 14-month low, indicating a degree of cooling in the labor market. Despite the short-term weakness, the overall perspective for gold continues to be positive.

Prominent financial institutions are consistently revising their long-term price forecasts, with HSBC and UBS indicating that gold prices may reach $5,000 per ounce in the first half of 2026. This outlook is attributed to geopolitical uncertainties, increasing fiscal pressures, and declining real yields. UBS underscored the likelihood of significant volatility should political or financial risks escalate.

Physical demand exhibited indications of recovery, as gold was traded at premiums in significant markets like India and China for the first time in almost two months, bolstered by a correction from its record highs. Central bank demand continues to be a robust foundation, with China prolonging its gold acquisition for 14 consecutive months, thereby solidifying bullion’s function as a safeguard against currency risk.

From a technical perspective, the market is experiencing long liquidation, as evidenced by a 0.93% decrease in open interest coupled with a price drop of Rs 267. Gold currently finds itself with immediate support at Rs 136,795, and a decline below this level may lead to a test of Rs 135,845. On the upside, resistance is observed at Rs 138,345, with a movement above this level paving the way toward Rs 138,945.