Gold prices are currently exhibiting a lacklustre performance in the domestic futures market, influenced by several factors including uncertainty surrounding US-India trade negotiations and relatively weak spot demand. Investors are closely monitoring the progress of the US-India trade talks, especially with the July 9 deadline approaching.

Tariff Uncertainty and Trade Dynamics

The ongoing trade negotiations between the United States and India are casting a shadow over the gold market. Any potential shifts in tariff policies or trade agreements between the two nations can impact investor sentiment and, consequently, gold prices. Escalating trade tensions typically boost demand for safe-haven assets like gold, while easing tensions can diminish its appeal. Recently, there have been instances where the anticipation and then the realization of tariff implementations by the U.S. led to fluctuations in gold prices, with initial spikes followed by corrections as the market adjusted.

Expert Analysis and Key Levels

Market experts are closely watching key levels for MCX (Multi Commodity Exchange) Gold to provide guidance to investors. According to Rahul Kalantri, VP of commodities at Mehta Equities, gold has support at $3,300-3,275 while resistance is at $3,345-3,360. In INR terms, support lies at ₹96,620-96,290, with resistance at ₹97,350-97,640. Manoj Kumar Jain of Prithvifinmart Commodity Research anticipates continued volatility in gold and silver prices, influenced by fluctuations in the dollar index and upcoming U.S. economic data releases. Jain suggests buying gold on dips around ₹96,400 with a stop loss of ₹95,800, targeting ₹97,200.

Factors Influencing Gold Prices

Several factors contribute to the current subdued performance of gold:

• US-China Trade War Worries: Easing concerns about the US-China trade war can weaken the global sentiment around safe-haven assets, leading to a sell-off in precious metals.
• Dollar Strength: A rising US dollar makes gold more expensive for buyers using other currencies, reducing its appeal.
• US Economic Data: Investors are closely watching key US economic data releases, such as job openings, personal consumption expenditures, and non-farm payrolls, as these can influence the Federal Reserve's interest rate decisions and, subsequently, gold prices.
• Geopolitical Tensions: Declining geopolitical tensions can reduce safe-haven demand for gold, as seen recently with a declared ceasefire between Iran and Israel.

Expert Recommendations and Technical Outlook

Experts recommend closely monitoring key support and resistance levels to make informed trading decisions. Abhilash Koikkara, Head - Forex & Commodities, Nuvama Professional Clients Group, notes that gold is holding a crucial support level around ₹95,800. A strong reversal from this point could trigger a recovery, targeting ₹98,500 and potentially ₹1,00,000.

Technically, gold's outlook suggests weakening bullish momentum. Key support lies in the $2,530-$2,500 range, with potential further declines targeting $2,400 and $2,300. On the upside, resistance around $2,900 could limit gains, with further barriers at $3,000-$3,020 and $3,130 if gold attempts a new record high.

Gold as a Safe Haven

Despite short-term fluctuations, gold remains a reliable safe-haven asset during times of economic and political uncertainty. Central banks, particularly those in emerging economies like China, India, and Turkey, have been increasing their gold reserves, highlighting its importance as a tool for financial stability.

In conclusion, gold prices are currently trading without clear direction amid US-India tariff uncertainty. Investors should pay close attention to trade negotiation developments, key economic data releases, and expert analysis of support and resistance levels to navigate the market effectively.