Gold Extends Gains as Russia-Ukraine Conflict Lifts Investor Outlook

Gold prices: The yellow metal witnessed a marginal price rise on Tuesday, driven by heightened concerns over the escalating Russia-Ukraine conflict. While the initial rally witnessed in the yellow metal was followed by a brief phase of profit booking, rising geopolitical uncertainties limited the potential downside.

Meanwhile, analysts suggest that the commodity market might be entering a consolidation phase ahead of key data releases.

"Gold remained largely flat near ₹97,700 after yesterday’s sharp rally of nearly ₹2,000, touching ₹98,000 on MCX. The market is now consolidating ahead of key US economic releases. Today’s highlight is the JOLTS job openings data," said Jateen Trivedi, VP research analyst - commodity and currency, LKP Securities.

The upcoming releases of the ADP non-farm employment change, ISM Services PMI and non-manufacturing prices are also expected to drive volatility in gold price levels. However, analysts expect the current momentum to continue owing to the Russia-Ukraine conflict.

"Gold prices are trading lower on profit-booking but underlying bias remains positive amid a rise in the safe-haven demand due to broad weakness in the US dollar, and escalation in the Russia-Ukraine war, rising economic uncertainty due to US-led tariff war," Pranav Mer, vice president, EBG of commodity and currency research at JM Financial Services, told PTI.

As of June 3, the rate of 24-carat gold (per 10 grams) stood at ₹99,060 in the Delhi NCR region, according to GoodReturns.

Key Levels to Watch

"The yellow metal broke out of a symmetrical triangle pattern around the $3,330 level on the daily charts just before opening hours in London, signaling a potential continuation of the prior uptrend," Axis Securities said in its report.

A symmetrical triangle usually signals a period of consolidation before the price breaks out in either direction.

"A slightly stronger dollar near 99.00 is exerting mild pressure, though the broader trend in gold remains bullish. Technical charts indicate support at ₹95,000, with resistance now seen at ₹99,500," Trivedi said.