“Gold has reached its inflection point. Even investors are a bit worried,” Jha said. “Previously, gold gave big rallies in 1979-80 and again in 2010-11, but after those peaks, it corrected sharply.”
According to Jha, the recent surge in gold prices has pushed investors’ portfolio allocations higher than usual. “Generally, people have 10-12% of gold in their portfolio, but after the recent price rise, that proportion has gone up to 18-22%. So, people may want to book profits now since gold is in an overbought zone,” he said.Jha expects gold to correct by about $300-$400 per ounce in the near term. “At that level, you can expect fresh investment opportunities,” he added, suggesting that long-term investors may re-enter once prices stabilise.
Despite the possibility of a short-term correction, Jha remains optimistic about India’s festive and long-term demand for gold. He said jewellery demand during Dhanteras this year was “better than expected”, with only a 15-20% dip in sales volume despite record prices and bullion sales rising over 25% year-on-year.
Gold prices in India edged higher on Monday (October 20), supported by expectations of further US interest rate cuts and global economic uncertainties. As of today, 24-karat gold is trading at ₹13,069 per gram, 22-karat at ₹11,980, and 18-karat (999 gold) at ₹9,802 per gram.
Globally, spot gold was up 0.1% at $4,253.33 per ounce, while US gold futures for December delivery climbed 1.3% to $4,266.30 per ounce. Despite the elevated prices, Jha believes a near-term correction would be healthy for the market, paving the way for sustained investor interest going forward.
