By Bhavik Patel
Gold price managed to sustain above $1800 and will end solidly 2022 by giving returns of almost 14 percent in MCX. For the 2023 outlook, we might see gold pushing above $1900 as sentiment started shifting from November this year. We will see a peak in the US Federal Reserve’s monetary policy in 2023 and global economic uncertainty is also expected to continue. Gold has given good returns whenever the US enters into recession and the US certainly is showing signs of slowdown.
In MCX, gold is trading near its all-time high thanks to the weak Indian Rupee. In fact gold is trading in all major currencies (except US dollar) at an all time high because the strong US dollar (which hit 20 year high this year) has depreciated all currencies. So all major currencies are either trading at all-time low or at 30-40 year low. Next week we might see consolidation continuing as foreign investors will return to the market. Momentum oscillator RSI_14 is trading at 62 and there are negative divergence showing on daily chart suggesting that we might see some correction going forward. Immediate support is at 54,342 where 20-day moving average is which coincides with weekly low. We would recommend buying at dips as long as 53500 does not breach. Any trend reversal is also expected below 53,500 while 56,000 is next resistance.
(Bhavik Patel is a commodity and currency analyst at Tradebulls Securities. Views expressed are the author’s own. Please consult your financial advisor before investing.)