Gold price falls by Rs1,800 to Rs241,200 per tola

ISLAMABAD: Gold price decreased in the country for the fourth session in a row by Rs1,800 per tola on Friday in line with a consistent drop in the price in the international market.
According to the data provided by the Karachi Sarafa Association, the price for one tola of 24-karat gold decreased to Rs241,200 from Rs242,000. Similarly, the price for 10 grams of 24-karat gold decreased to Rs205,933 from Rs207,476, showing a dip of Rs1,543. Earlier on Tuesday, Wednesday and Thursday, the gold price in the local market came down by Rs1,900, Rs300 and Rs6,200 per tola, respectively.
It is worth noting that the price has been kept Rs4,000 below its actual cost, the Karachi Sarafa Association reported, saying: “In view of the significant reduction in purchasing power, the price of gold today has been kept under cost by Rs4,000.”
The gold price in the country surged by Rs7,100 per tola in April. It may be noted that the gold price hit an all-time high in Pakistan on April 20 when it reached Rs252,200. Earlier gold price per tola in Pakistan hit all-time highs of Rs251,900 on April 17, Rs247,300 on April 16 and Rs247,600 on April 9.
On the other hand, gold futures in the international market as of 1415 hours GMT were available at $2,336 per ounce, showing an increase of $6.80. Out of the $6.80 increase, +$6.25 was due to weakening of the US dollar and $0.55 was due to predominant buyers, according to the Kitco Gold Index.
Gold fell nearly 4 percent in the previous two trading days and touched its weakest level in two weeks below $2,330 on Thursday. As US Treasury bond yields stabilized on Friday, the gold price staged a correction towards $2,340 but remained on track to post large weekly losses.
From a technical perspective, gold price has decisively broken below a major trendline for the uptrend since February, ushering in a new more bearish technical atmosphere. The steep decline from the all-time highs registered on Monday now suggests that gold is probably in a short-term downtrend, favoring short positions over longs. The Relative Strength Index (RSI) became oversold and then reentered neutral territory, suggesting an increased chance of a pull back.
On the downside, a break below the $2,325 lows would provide confirmation of more downside to the $2,300 round figure, followed by $2,272. A decisive break back above the trendline at $2,360 would provide evidence of a recovery and reversal of the short-term downtrend. – TLTP