Gold rally to hit a snag? Motilal Oswal says upside needs fresh triggers

Gold price: The yellow metal has witnessed a stunning double-digit rally of roughly 30 per cent so far this year, aided by geopolitical tensions

Gold price outlook: Gold has experienced a robust rally so far in calendar year 2025, surpassing the gains of nearly every asset class, including equities. While the yellow commodity witnessed gains of around 30 per cent on a year-to-date basis (YTD), the benchmark Nifty50 index saw a single-digit surge of 8 per cent. Tariff tensions, escalating conflict in the West Asia region, alongside a weakening dollar, prompted investors to turn to the yellow commodity. Riding the uptrend, Silver and Platinum followed the trajectory as the 'safe-haven' asset class gained heightened attention.

 

However, Motilal Oswal is skeptical of any further upside. The yellow metal needs "fresh, significant catalysts" to witness any further upside, according the brokerage firm.  "So far, we've witnessed gains exceeding 30 per cent, and historical data over the past 25 years shows that Comex gold has never achieved more than 32 per cent returns in a single year," the brokerage firm stated in its recent report.

 

"At this stage, we need to wait for more clarity or a decisive trigger, so a period of consolidation may be appropriate," it added. 

  The de-escalation of tensions between Israel and Iran, coupled with recent trade agreements between nations following Trump's tariff play, has improved the overall investor outlook, erasing uncertainty and reducing gold's appeal.

 

Earlier this year, multiple global brokerage firms, including Goldman Sachs and JP Morgan, raised their gold target price as analysts predicted geopolitical tensions to weigh down the overall investor sentiment for the risky asset class. As of now, gold futures are trading around $3,350 price level in the international market. At home, prices remain at ₹98,550 level, in the Delhi NCR region.

 

What should investors do?

 

While the current outlook looks largely flat, analysts at Motilal Oswal pointed out that longer-term triggers might aid a further rally in the yellow commodity.

 

"Should any longer-term triggers emerge, we would consider re-entering to continue our successful run," the brokerage firm said, adding that "technical traders holding long positions may consider hedging or exiting on sustained close below ₹96,000."