Latest Gold Market Update: Expert Advises 'Sell on Rise' Strategy Amid Bearish Trends
The gold market is currently facing challenges, struggling to maintain higher price levels. Following a significant drop, the overall short-term market structure for gold appears weak. Financial experts are recommending a specific trading approach for today: a "sell on rise" strategy. This means traders should consider selling gold when its price temporarily increases, as these upward movements are likely to be met with renewed selling pressure.
According to Jateen Trivedi, Vice President of Research Analysis for Commodity and Currency at LKP Securities, gold is finding it difficult to hold onto its gains. His expert view points towards a bearish outlook for intraday trading, suggesting that any rallies could be short-lived.
Gold's Technical Setup: A Closer Look at Key Indicators
A detailed examination of several important technical indicators reveals signals that largely support a bearish stance for gold prices.
- Moving Averages (EMA 8 & EMA 21): Gold's price is currently trading below both its 8-period and 21-period Exponential Moving Averages (EMAs). This position confirms a short-term bearish structure. The downward slope of these moving averages further indicates sustained selling momentum in the market. The critical level of ₹1,54,500 acts as a strong supply zone, aligning with the EMA resistance cluster.
- Bollinger Bands: While gold has shown a slight rebound from the lower Bollinger Band, it continues to trade beneath the mid-band. This suggests that the recent upward move is more likely a corrective pullback within a larger bearish phase, rather than a definitive market reversal.
- Price Structure: The price chart clearly illustrates a breakdown from previous levels, followed by the formation of a lower high. This pattern reinforces the negative outlook. Until gold decisively reclaims the ₹1,56,500 mark, the intraday market bias remains negative.
- RSI Indicator (Relative Strength Index): The Relative Strength Index (RSI) is hovering around 42. This figure, staying below the neutral 50 mark, reflects weak momentum and supports the expectation of continued downward price pressure.
- MACD (Moving Average Convergence Divergence): The MACD indicator remains in negative territory. Even with a minor flattening, the absence of a bullish crossover signals that selling pressure has not yet fully subsided.
Recommended Intraday Trading Strategy for Gold
Based on the current technical analysis and observed market trends, the following intraday trading strategy is recommended for gold traders:
| Strategy Component | Details |
|---|---|
| Trading Approach | Sell on Rise |
| Entry Level | Around ₹1,54,500 |
| Stop-Loss | Above ₹1,56,500 |
| Price Targets | ₹1,52,000 and ₹1,51,000 |
| Market Bias | Bearish below ₹1,54,500; a reversal would only occur above ₹1,56,500 |
Outlook: Why the Bearish Bias Continues
The broader intraday market structure for gold remains fundamentally weak, primarily due to the recent sharp sell-off. Any attempts by gold prices to rally towards resistance levels are widely anticipated to attract new selling interest from traders. The current recovery efforts are seen as corrective in nature rather than a sign of a sustained turnaround, with prices struggling to hold above immediate short-term resistance points.
Disclaimer: Please note that all recommendations, views, and tips regarding the stock market, other asset classes, or personal finance management provided by experts are solely their own opinions. These perspectives do not necessarily reflect the views of this publication or its affiliates. Always conduct your own thorough research and consult with a qualified financial advisor before making any investment decisions.
