Page 18 - Bullion World Volume 3 Issue 1 2023

Bullion World | Volume 3 | Issue 1 | January 2023

Bullion Price Outlook for 2023

By Dr Renisha Chainani, Head-Research, Augmont - Gold for All

to retreat more in 2023. That will
make the FED stance more hawkish
to keep the FED pivot from the
second quarter of 2023, which
would lead to a fall in the Dollar steeper than the first. The price rises
Index and US Treasury yield and in again and drops for the final time.
turn, bullish for Gold. An inverse head and shoulders
pattern indicates the end of the
Moreover, we can see a Trend bearish phase and the onset of an
reversal in COMEX Gold Daily Chart uptrend when the price moves above
as predicted by Inverse Head and the neckline resistance.
Shoulder pattern and Triple Bottom
pattern shown in the chart below. As we can see from the chart, gold
The inverse head-and-shoulders prices have touched the low of
pattern is a common downward $1620 (Head) thrice, which is also
Dr Renisha Chainani
trend reversal indicator. An inverse a Triple bottom pattern formation.
Gold Outlook head and shoulders pattern forms A triple bottom is generally seen as
Gold started the year 2022 around when the price of an asset falls to a three roughly equal lows bouncing
$1800 (~Rs 48000) levels, climbed trough, then rises, and falls for the off support followed by the price
to $2076 (~Rs 55000) in March and second time, but this time the fall is action breaching resistance.
fell to $1620 (~Rs 49000) in August.
Prices have then recovered back to
sub $1800 levels in December.
So, all in all, it has wiped out all
gains and losses of the year and is
trading at the same level as January
now on international markets. But in
domestic markets, prices are close
to Rs 54500 now, which is equal
to around a 15% return. This is
because of USDINR depreciating by
the same percentage.

The Russia-Ukraine war was the
main catalyst for the gold rally in
Q1 2022. Rising real interest rates
were a headwind for gold for Q2
and Q3. FED raised rates by 450
bps in 2022 to tame multi-decade
high inflation. However, in Q4, we
saw strong festive and marriage
season demand, due to which prices
picked up followed by FED's hawkish
stance.

After topping at 9.1% in June 2022,
US CPI has cooled off gradually to
7.1% in November and it's expected

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