Gold Price Drop: Big Price Drop of Gold Coming After Diwali? Experts Give a Surprising Forecast

Gold Price Drop: The festive season saw a rush to buy gold. Despite high prices during Dhanteras, people bought gold for the auspicious occasion. But will the price decrease as soon as Diwali ends? Market experts are indicating just that. According to them, a fall in gold prices may be seen starting next week. They view this decline as a “temporary slowdown.”

This forecast, after weeks of rising gold prices, has brought new hope to both buyers and investors. But what is the real reason behind this price drop? And how much should one capitalize on this opportunity? Let’s find out the experts’ opinions in detail.

Why is there a possibility of gold prices falling?

According to market experts, the demand for gold was at its peak during Diwali and Dhanteras due to the festivities. This huge demand was the reason for the price hike. According to Sugandha Sachdeva, founder of SS WealthStreet, gold is currently in the ‘overbought zone’, meaning more has been purchased than necessary.

With the end of the festival, this demand will naturally decrease. This deficit in demand will be the main reason for the price drop. Additionally, due to recent geopolitical tensions (like the Russia-Ukraine and Israel-Hamas situations), gold was being considered a ‘safe investment’, which had increased its price. Now, with indications of those tensions easing slightly, gold prices may trend downwards.

What other factors are experts monitoring?

Pranav Mer, Vice President of Commodity and Currency Research at JM Financial Services Ltd., stated that traders are currently monitoring several international indicators that will directly impact gold prices in the coming week.

• International Data: Chinese economic data and the UK’s inflation rate.
• US Economy: US consumer confidence data and potential decisions regarding the Federal Reserve’s interest rates.
• Geopolitical Situation: The possibility of trade talks between the US and China and hopes for ceasefires. If these situations normalize, the investment pressure on gold will decrease, leading to a fall in price.

Important Advice for Investors: Is this the right time to buy gold?

Although experts are forecasting a price drop, they are identifying it as a short-term opportunity. This is both a warning and a golden opportunity for investors.

According to Sugandha Sachdeva, after this temporary fall, gold prices could take a big leap again. She predicts that after this break, the price of gold could reach ₹1,45,000 to ₹1,50,000 per 10 grams.

Therefore, the experts’ advice is that whenever the price drops after Diwali, that will be the best time to buy and hold gold. Especially those who are thinking of buying gold for the future (like for a wedding) or for long-term investment can take advantage of this dip. As the wedding season starts right after the festive season, it would not be wise to miss this opportunity of falling prices.