For the first time in Dubai, 22K gold prices have surged to an unprecedented Dh400 per gram as the metal also surpassed the significant $3,600 mark.
On Sunday, gold reached a record high with 24K priced at Dh433.25 per gram, 22K at Dh400.25, 21K at Dh383.75, and 18K at Dh328.75, as per Dubai Jewellery Group’s data.
Spot gold was trading at $3,586.76 per ounce, marking a 1.06% increase. It hit $3,600 on Friday amid expectations of further interest rate cuts by the US Federal Reserve.
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As prices rise, some consumers delay their jewelry purchases due to affordability concerns, while investors in gold coins and bars face a dilemma on whether to buy more or sell to capitalize on profits amid the ongoing rally.
Rania Gule, a senior market analyst for Mena at xs.com, advises UAE residents and investors to consider taking partial profits at current levels near $3,600, while keeping a portion to benefit from the rally’s potential continuation towards $3,700, provided the metal stays above key support. “It’s crucial to monitor these support levels closely to spot new buying opportunities or re-entry after any significant correction,” she added.
Gule told Khaleej Times that managing portfolios through partial profit-taking while retaining a strategic portion is the wisest strategy to balance returns and risk.
“Gold is experiencing a robust rally after reaching the $3,600 per ounce mark last Friday, reflecting strong demand as a safe haven amid a volatile global economy, expectations of a US interest rate cut, and a weak dollar. This rise supports the long-term bullish trend for gold, driven by ongoing global inflation and geopolitical uncertainty, making it an attractive option for investors seeking safety and value preservation,” said Gule.
If gold undergoes a short-term correction and profit-taking, the first support level is likely around $3,520 to $3,500.
“If this level is breached at the daily close, the correction could extend to $3,411 to $3,400. Alternatively, if gold remains above $3,550 and successfully retests the $3,600 level, the rally might continue towards $3,700 before a potential deeper correction down to $3,325 to $3,300, prior to attempting new highs,” Gule explained.
Rashad Hajiyev, founder of RM Capital Consulting, anticipates a pullback in gold prices next week to retest breakout points.
“Gold will likely remain stable until the Federal Reserve meeting on September 17. I foresee more declines in gold next week than rises, which is beneficial. I prefer a solid price foundation rather than a baseless rally ignored by miners that results in a deeper pullback later. I hope to see gold establish firm footing,” he stated.
