UAE: Gold prices drop Dh1 per gram in Dubai in early trade

Gold prices softened by Dh1 per gram in the UAE on Friday morning after hitting a record high in the previous session.

The Dubai Jewellery Group data showed 24K trading at Dh275.75 per gram at the opening of the markets on Friday compared to Dh276.75 per gram when they closed on Thursday.

The other variants of the yellow metal also opened lower, with 22K trading at Dh255.25 per gram; 21K at Dh247.25; and 18K at Dh212.

Spot gold was trading lower at $2,279.77 per ounce at 9.40am, UAE time as profit-taking stepped in. Prices briefly touched $2,300 per ounce on Thursday morning but later retreated in the day and closed lower.

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Alex Kuptsikevich, senior market analyst at FxPro, said the gold price briefly exceeded $2,300 on Thursday, recording another round level, not counting an update of the all-time high.

“This is an occasion to assess gold's prospects, which are becoming a little less unambiguous," he said.

"Gold has added every trading session since March 25 but has so far been subdued since the start of the day on Thursday morning. The next step in this pattern is profit-taking, allowing the price to cool somewhat,” he said.

On the daily time frames, it was close to the early March peaks, after which the past consolidation began.

“The bears took control in March 2022 at similar overbought levels. However, in July 2020, the price continued to grow after reaching similar parameters. In similar conditions in 2019 and 2020, there was a growth stop but not a reversal. The balance of power is in favour of the bears,” he added.

Kuptsikevich said now is the time for bulls to be wary of the importance of labour market data for gold. “They have a lot to lose as the price flew into space, partly ignoring the latest economic data coming out on the dollar's side, from strong manufacturing PMIs to the acceleration in wage growth that ADP talked about on Wednesday,” he added.

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