Gold price prediction: Where are prices headed today - Check outlook for today

Investors will closely monitor the upcoming US monthly job report to be released on May 8. A decent job report will weigh further on gold prices. (AI image)

Gold price prediction today: Gold prices are expected to continue seeing volatility in the near-term, says Praveen Singh, Head Currencies and Commodities, Mirae Asset ShareKhan.Gold Price Performance:

Spot gold prices tumbled on Monday as oil prices surged on escalating geopolitical risks in the Middle East region.

At the time of writing this article, the metal was trading at $4524, down by $90 (around 2%) for the day as Dollar Index, US yields and oil prices surged.

The yellow metal closed with a weekly loss 2% in the week ending May 1-- its second straight weekly loss.

Geopolitics and oil:

Critical energy infrastructure and tankers in the Middle East came under attack once again on May 4 as an Iranian drone strike caused a fire in a key oil industrial zone in the United Arab Emirates city of Fujairah -- a major hub for both crude oil and fuels. It is strategically important for both the UAE and global markets because of its position outside the Strait of Hormuz.

Oil prices were already mostly higher on May 4 on reports of more tankers coming under fire in the Strait of Hormuz.

Earlier, the head of the Iranian parliament’s National Security Commission, called US plans to try and restore transit through the strategic waterway with the help of the Military starting Monday a violation of a fragile ceasefire.

Treasury Secretary Scott Bessent said the US is suffocating Iran with economic and financial pressure and the US believes Iran’s oil industry may need to start shutting in wells within a week on country’s crude storage getting filled up rapidly.

The US and Iran remain at conflict on the critical issue of nuclear enrichment.

Data roundup:

US ISM manufacturing Index data released on May 1 showed expansion for the fourth straight month in April, though the Index at 52.7 lagged the estimate of 53.5. ISM prices climbed to 84.6--a four-year high-- while the employment Index continued to contract.

Data released on Monday showed that US factory orders rose 1.5% m-o-m in March 2026 Vs the forecast of 0.5%.

Dollar Index and yields:

At the time of writing this article, the US Dollar Index at 98.49 was up by 0.50% for the day as US yields spiked on inflation concerns.

Two-year yields at 3.97% were up by 2.38% for the day, while ten-year US yields at 4.45% were up by 1.90% for the day.

Both two-year and ten-year yields touched the highest level since March 27.

Fed rate cut/hike chances:

Implied overnight rates price in 0.33 rate hikes by the year-end as opposed to a 0.05 rate cuts as seen on May 1.

Rates are now pricing in 0.79 rate hikes by April 2027, a sharp rise from pricing 0.22 rate hikes as on May 1.

Gold ETF holdings:

Total known global gold ETF holdings stand at 98.66 MOz, down by 0.29MOz YTD.

Global gold ETF holdings rose 0.89 MOz in April as lower prices lure buyers; however, gold holdings have fallen by 2.26 Moz since the Iran war broke out on February 28.

CFTC positioning:

In the week ending April 28, money managers decreased their bullish gold bets by 3,924 net-long positions to 91,574 – least bullish in more than two years, as per weekly CFTC data on futures and options. Short-only positions rose 2,298 lots to 32,708, the highest in more than six months

Upcoming data and reports:

Major US data on the deck this week include April ISM services Index (May 5), March JOLTs job openings (May 5), April ADP employment change (May 6), May University of Michigan Sentiment and inflation expectations and April nonfarm payroll (May 8).

China's services and composite PMIs will be released on May 6.

Investors will also monitor Eurozone's manufacturing PMI (May 4) and services PMI (May 6).

Bank of Japan's March meeting minutes will be released on May 7.

Gold Price Outlook:

Gold is vulnerable as US yields spike higher due to surging oil prices stoking inflation risk. Fed rate cut probability has been priced out as of now, though the situation may change should oil prices fall on a sustainable basis soon, which, however, is possible only if US and Iran agree to an amicable deal – a low probability event given their stark differences over Iran’s nuclear enrichment.

Investors will closely monitor the upcoming US monthly job report to be released on May 8. A decent job report will weigh further on gold prices.

Should the support at $4500 break, the next key support at $4410 will emerge as the immediate downside target for bears. Interim support is at $4452. Resistance is at $4603/$4670/$4705.

(Disclaimer: Recommendations and views on the stock market, other asset classes or personal finance management tips given by experts are their own. These opinions do not represent the views of The Times of India.)

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