Gold Price Forecast Diwali 2026 : A sharp decline in gold prices has caught the attention of investors and people planning to purchase jewellery. On the Multi Commodity Exchange (MCX), gold has fallen by more than ₹38,600 from its record high. On January 29, 2026, gold reached a record price of ₹1,80,779 per 10 grams. Prices subsequently came under sustained pressure. During Friday’s trading session, gold futures dropped to ₹1,42,024 per 10 grams. This has raised questions about the reasons behind the steep decline and how prices may move ahead of Diwali 2026.

Profit Booking Adds Pressure on Gold Prices
Profit booking is considered one of the major reasons behind the decline in gold prices. When the price of an investment rises sharply, many investors sell their holdings to secure profits. Similar selling pressure emerged after gold reached record levels. Large-scale selling can push prices lower, and investors’ profit booking is being viewed as an important factor behind the current decline. However, gold prices are influenced by several factors, and market movements cannot be attributed to a single cause alone.

Strong Dollar and Interest Rates Affect Gold
A stronger US dollar in international markets can also put pressure on gold prices. When the dollar strengthens, gold becomes more expensive for buyers using other currencies, potentially affecting demand. Meanwhile, concerns about inflation and crude oil prices may weaken expectations of US interest rate cuts, adding further pressure on gold. Since gold does not pay interest, other assets may become more attractive to investors when interest rates remain high.

Gold Trades 21% Below Its Record High
On the MCX, gold fell from its record high of ₹1,80,779 per 10 grams to ₹1,42,024. This represents a decline of ₹38,755, or approximately 21.43%. Gold prices also fell in international markets. According to the available information, gold declined by around 4% in a week, dropping below the key level of $4,000 per ounce. Silver prices also came under pressure. However, the actual retail price of gold in India can vary by city and depends on purity, GST and jewellery-making charges.

Could Gold Prices Rise Again Before Diwali?
According to Ponmudi R, CEO of Enrich Money, the ₹1,40,000-per-10-gram level on the MCX is an important support level for gold. If prices remain above this level, the market could see a recovery. Based on his assessment, gold could reach ₹1,48,000 to ₹1,52,000 per 10 grams before Diwali. However, this possibility depends on market movements. Changes in the dollar, interest rates and international demand could influence the direction of gold prices.

Gold Prices Could Decline Further
If gold falls below the important support level of ₹1,40,000 per 10 grams, the possibility of further declines could increase. According to Ponmudi R’s estimate, prices could then move into the ₹1,36,000–₹1,38,000 range. Gold’s direction ahead of Diwali will therefore depend on several economic indicators. The decline may offer some relief to jewellery buyers, while investors will need to account for market volatility. For now, it remains uncertain whether gold will recover or experience further losses.