Gold holds steady as large gold ETF subscription limits are imposed

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Gold slides 0.08% to $4,331.82 today

Highlights

Major Indian mutual funds imposed restrictions on large gold ETF subscriptions after record ₹31,600 crore inflows in March 2026, signaling supply constraints.
Import duties and operational complications are impeding further institutional gold exposure and introducing headwinds for speculative flows.
Gold price trades in a bearish technical setup with 57% downside probability over the $4,280.36–$4,383.28 near-term range.

Institutional gold ETF inflows curtailed amid supply and regulatory strain

Major Indian mutual funds including HDFC Mutual Fund, ICICI Prudential Mutual Fund, Nippon India Mutual Fund, and Kotak Mutual Fund imposed restrictions on large subscriptions into gold ETFs after reporting record-high net inflows of approximately ₹31,600 crore during the March 2026 quarter. This action aimed to address ongoing supply constraints, tracking errors, and the impact of higher import duties that have complicated gold market operations in India. These developments limited the ability of institutional investors to increase gold exposure, which may dampen further speculative inflows and add operational headwinds, though price action has remained under broader selling pressure.

Contrasting momentum signals as buyers challenge multi-level resistance

The nearest resistance for XAU is defined by the Ichimoku Kijun at $4,372.30, while immediate support resides near $4,280.36. Momentum indicators reveal a complex landscape: MACD remains on strong sell, ADX signals a selling environment, and RSI stands neutral at 43.79 but signals selling. Meanwhile, Stoch RSI and Bull/Bear Power (BBP) are overbought, pointing to recent buyer dominance and the potential for short-term reversals. CCI and the Awesome Oscillator (AO) both register neutral, highlighting a divergence between short-term intraday demand and underlying weakness across the broader trend.

Downside risk prevails as range-bound trade expected short term

In the short term, price is expected to consolidate within the $4,280.36 to $4,383.28 range over the next two to three sessions, in line with typical volatility bands. The probability for a downward move is higher at 57% versus a 43% chance of upside. If price overcomes resistance, XAU could attempt a run toward the upper boundary, while a drop below $4,280.36 may accelerate further declines.

Anton Kharitonov, expert at Traders Union, views the recent restrictions by major Indian mutual funds as a defensive response to extreme gold ETF inflows. He points to ongoing supply constraints and market frictions as factors reducing the upside case for gold, with technicals also maintaining a bearish tilt. Kharitonov believes caution is warranted unless resistance levels are clearly breached. "Base case remains range-bound with a downward bias — unless XAU reclaims $4,372.30, I remain defensive."

Previously it was reported that U.S. lawmakers called for a halt and audit of certain Mint gold coins due to concerns over illicit foreign sourcing in the federal gold supply chain. While those regulatory and compliance pressures continue to shape sentiment, today's shifting technicals and restrictions by major Indian mutual funds suggest that market participants should closely monitor institutional flows and their effect on near-term price stability.

Source of Data: XAU Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.