UAE: Gold prices inch lower, but still trade close to 2-month high

The precious metal has been in a downtrend, forming a series of declining local highs and lows

by

Waheed Abbas

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Published: Mon 4 Mar 2024, 9:32 AM

Gold prices inched lower in the UAE in early trading on Monday morning in line with a slight drop in global rates. But the prices were still trading at nearly a two-month high.

According to Dubai Jewellery Group data, the 24K variant of the yellow metal was trading at Dh252.0 per gram at the opening of the markets on Monday as compared to last week’s close of Dh252.25 per gram. Among the other variants of the precious metal, 22K opened at Dh233.25, 21K at Dh225.75 and 18K at Dh193.5 per gram.


Spot gold edged 0.13 per cent lower to $2,080.84 per ounce as of 9.15 am UAE time, after hitting $2088.19 on Friday – its highest since December 28.

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Alex Kuptsikevich, senior market analyst at FxPro, said since peaking at the very end of last year, gold has been in a downtrend, forming a series of declining local highs and lows.

“Since mid-February, risk appetite has been growing in financial markets, as evidenced by the synchronised increase in buying in European and Asian markets and the ongoing rally in cryptocurrencies since the beginning of the month. But there is no need to rush, as we can only call a break of the downtrend corridor after a consolidation above the previous high. Gold is currently testing this top at $2,055, which is a substantial level from which selling has intensified since early January. Moreover, the price has failed to consolidate above this level since August 2020. It could well be called a historical resistance,” he said.

“It will be possible to talk about the realisation of the bullish scenario for gold after the daily candle closes above $2,055. In this case, the first target for growth will be in the region of $2,088 – the December high,” he added.

Rania Gule, market analyst at XS.com, said the recent comments from several Fed members suggest that the central bank may not be in a rush to cut interest rates, and the policy meeting in June might be the first opportunity for a rate cut. The hawkish outlook continues to support the rise in US Treasury bond yields, potentially limiting the decline of the dollar and weakening the current upward trend in the gold price.

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