Gold prices in New Delhi were at Rs 8,797 per gram for 24 karat gold, Rs 8,065 per gram for 22 karat gold as international market prices were range-bound. During the Asian session, gold prices went higher and then retraced. Gold prices have experienced a minor correction but remain resilient above the $2,900 psychological level, which continues to serve as a strong support for traders. In the Asian session on Monday, gold prices dipped to $2,908, with key support seen in the range of $2,892–$2,887. The short-term technical outlook remains bullish, provided gold sustains its position above the 21-day Simple Moving Average (SMA) at $2,911. A decisive break above $2,930 could fuel an upward momentum, with targets at $2,956 and $2,970. However, a breakdown below last week's lows could push prices toward $2,835.

Gold Price Movements and Key Levels

1. Gold’s Resilience Above $2,900
Gold prices corrected slightly last week but quickly rebounded above $2,900, confirming strong buyer interest.
In the Asian session on Monday, prices dropped to a low of $2,908 before rebounding.
The intraday high reached $2,918, reinforcing the current trading range.
The $2,900 level remains a crucial psychological threshold for traders, with strong defense from buyers.
2. Key Support and Resistance Levels
Immediate Support: The $2,900 level serves as the first support, with additional backing at $2,892–$2,887.
Major Downside Risk: A sustained breakdown below last week's low could expose gold prices to $2,835, a key demand area.
Upside Resistance: A breakout above $2,930 could push prices toward an all-time high of $2,956, with the next barrier at $2,970.

Technical Indicators and Market Sentiment

1. Moving Averages and Short-Term Trend
The 21-day SMA at $2,911 is a critical technical level.
As long as gold prices close above this moving average on a daily candlestick basis, the short-term trend remains bullish.
A close below $2,911 could signal short-term weakness, inviting further selling pressure toward $2,850.
2. Relative Strength Index (RSI) Analysis
The RSI remains comfortably above 50, indicating a positive market sentiment.
This suggests bullish momentum is intact, with buyers likely to retain control in the near term.
However, if the RSI dips below 50, selling pressure could intensify, bringing support levels into focus.
3. Potential Breakout Above $2,930
The February 26 high of $2,930 acts as a strong resistance.
A sustained move above this level could drive gold prices toward $2,956, followed by $2,970.
Traders are closely watching for volume confirmation and strong candlestick formations to validate a bullish breakout.

Market Factors Influencing Gold Prices

1. Inflation and Interest Rate Expectations
Gold remains a preferred hedge against inflation, and any signs of rising inflationary pressures could boost demand.
If central banks signal a dovish stance on interest rates, gold prices could benefit from a weaker U.S. dollar and lower bond yields.
2. Geopolitical Uncertainty and Safe-Haven Demand
Ongoing geopolitical tensions and economic uncertainties continue to drive safe-haven demand for gold.
Any escalation in global conflicts or financial market instability could push prices higher as investors seek risk-averse assets.
3. U.S. Dollar and Treasury Yields Impact
The U.S. dollar index and Treasury yields play a key role in influencing gold prices.
A weaker dollar typically supports gold prices, while higher Treasury yields tend to cap gains.
Traders should monitor Federal Reserve statements and macroeconomic data releases for cues on future interest rate policies.

Trading Strategy and Outlook

Bullish Case: Targeting $2,970

If gold sustains above $2,911 and breaks past $2,930, traders may look for an upward extension to $2,956–$2,970.
The RSI remains bullish, supporting further upside potential.
Traders should monitor buying pressure near $2,930 for confirmation of the next leg higher.

Bearish Case: Watching for a Breakdown Below $2,900

A daily close below $2,900 could signal weakness, targeting $2,892–$2,887 as immediate supports.
A failure to hold above $2,835 could trigger a sharper sell-off toward lower support zones.
If RSI drops below 50, sellers may dominate the price action.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should conduct their own research before making any trading decisions.