Gold Keeps Climbing—But Is It Time to Buy or Step Back?
Tuesday, May 20th 2025
Amid growing turbulence in global markets, gold continues its dramatic rise, drawing both seasoned investors and cautious onlookers into its glittering orbit. On Monday, prices surged yet again, with MCX Gold shooting up to Rs 96,747 per 10 grams in early trade, reflecting a deepening flight to safety.
As of 10:07 AM, the June 5 MCX contract was holding firm at Rs 96,423, up over 1.23% from the previous close—an indication that demand for the yellow metal remains solid despite recent price fatigue.
Why Is Gold Running Hot?
Multiple factors are converging to push gold to record highs. Chief among them is the continued decline of the US dollar, which just touched a three-year low. Since gold is dollar-priced, a weaker greenback makes it cheaper and more attractive for buyers using other currencies—helping to fuel this rally further.
Meanwhile, in international markets, spot gold spiked to $3,384 an ounce, as risk aversion spreads across borders due to the lingering US-China trade conflict, and an increasingly fragile global economic outlook.
But Monday’s rally came after a brief cooling-off period. On the previous trading day, MCX Gold dipped 0.44% to Rs 95,239, as some investors locked in profits. Despite that dip, the broader story remains: uncertainty is driving the gold rush.
Policy Moves Stir Market Nerves
Investor anxiety has been amplified by Washington’s political theater. President Trump’s tariff pause did little to soothe markets, as his administration maintains a hardline stance on China. Even more unsettling are rumors suggesting Trump may be eyeing the removal of Federal Reserve Chair Jerome Powell—a move that could severely shake investor confidence in US monetary policy.
Is It the Right Time to Jump In? Experts Weigh In
Not all analysts agree on the next step for investors.
Jateen Trivedi of LKP Securities urges caution. According to him, gold is facing resistance near $3,350 and signs of short-term exhaustion are showing. “Support lies between $3,280–$3,290, and if that breaks, we could see a slide towards $3,150,” he warns. With high volatility persisting, Trivedi recommends avoiding aggressive new positions for now.
Satish Dondapati, Fund Manager at Kotak Mahindra AMC, offers a more bullish long-term view. He points out that gold has already risen over 25% in 2025, including a notable 6% bump since April 2—triggered by the latest tariff headlines. He believes central bank buying and enduring geopolitical risks will underpin gold prices in the months to come.
But in the short term, a note of caution rings through.
Manoj Kumar Jain of Prithvifinmart suggests adopting a wait-and-watch strategy. “With speculation still swirling around the US-China trade negotiations, volatility could persist. It’s best to hold off on fresh trades this week,” he advises. He pegs immediate support at Rs 94,750, with resistance near Rs 96,000.
A Golden Dilemma
Gold’s rise is more than a market phenomenon—it’s a signal of widespread nervousness across global financial ecosystems. But just because prices are climbing doesn’t mean every investor should rush in.
The metal may shine brightest during times of crisis, but that light can be blinding if you’re not careful. With resistance levels looming and global developments shifting fast, timing—and temperament—remain the keys to navigating the golden path.
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