Gold will retreat lower from the current highs once the adverse effects of Coronavirus fades and global economy stabilizes, said Hitesh Jain of Yes Securities

''Gold prices moved above USD 1,600 a oz (seven-year high) amid concerns over the economic impact of Chinese epidemic. However, we sense that markets will eventually start pricing in the fact that worst of Coronavirus crisis seems to be over, with new infection rates and deaths peaking.''

The number of survivors from the Coronavirus infections is reported around 14,000, which indicates that growing number of people are able to survive the illness.

Further he said, ''On the economic side, restrictions on travel in Wuhan and other cities of Hubei province has certainly dented Chinese manufacturing activity. However, the impact is deemed to be temporary.''

During similar epidemic in the past (SARS), economic impact was very short-term in nature, with the health-scare induced slowdown not persisting for more than 3-4 months.

''We sense that markets will gradually harbor expectations that Chinese efforts to stimulate the economy will frontload demand into the second half of the year'', he added.