Gold prices fall by around Rs 300 to Rs 78,255 per 10 gm, silver down over Rs 800/kg ahead of Dhanteras tomorrow
Ahead of the festivities that will kickstart tomorrow, precious metals both silver and gold traded lower, nevertheless, momentum is likely to continue this week.
Gold prices ahead of the auspicious festival of Dhanteras on Tuesday (October 28) traded on a subdued note tracking international markets. At around 10:28 am, Gold December futures traded lower by Rs 277 or 0.35 per cent at Rs 78,255 per 10 gm.
In the last one year, gold has delivered around 30 per cent.
COMEX Gold
On the COMEX, gold prices faced downward pressure and traded weak by 0.34 per cent at $2,745 per ounce.
Silver futures witness sharper correction
Silver December futures, meanwhile, traded with a sharp cut of 0.84 per cent or Rs 816 at Rs 96,318 per kg.
Pullback in gold after record highs hit last week
After hitting record highs near $2,758 last week, gold prices are witnessing a pullback. Nonetheless, the downside in the precious metal may remain capped amid the ongoing geopolitical tensions and uncertainties surrounding the US presidential election. Israeli Prime Minister Benjamin Netanyahu said that Saturday’s attack on Iran severely damaged Tehran’s defenses. Meanwhile, Iranian officials vowed an “appropriate response” Sunday, while saying they do not seek a wider war, as per CNN.
Dollar index resulting in gold's weakness
The dollar index (DXY) at the last count was up by 0.3 per cent, rendering gold less attractive for other currency holders.
Gold price outlook in the near term
Neha Qureshi, Senior Technical & Derivative Analyst, Anand Rathi Commodities & Currencies said, "After a historic week, all eyes will be on gold prices in India as the big season of buying these precious metals is kick-starting during the October 28 to November 1 trading session."
Apart from the festive cheer, gold prices are likely to be influenced by geopolitical tensions, lowering interest rates, a slew of economic data, and performance in treasury yields and the dollar, the expert added.
Momentum in precious metals to continue this week
Qureshi added that although the gold rally looks overstretched, from a fundamental standpoint, the momentum may continue this week. Short-term pull backs at this point, could continue to offer buying opportunities with markets poised for new highs in the coming quarters.
Trading strategy in gold/silver
For intraday, Qureshi advised the below trading strategies for gold and silver:
– SELL MCX DECEMBER Gold futures at Rs 78200 with a stop loss of Rs 78400 and a price target of Rs 77900.
– SELL MCX DECEMBER Silver futures at Rs 96500 with a stop loss of Rs 97500 and a price target of Rs 95000
Buying on dips in gold recommended
Meanwhile, Manoj Jain, Director- Prithvi Finmart recommends buying gold on dips around Rs 77000-75000 with a stop loss of Rs 71200 on a weekly closing basis for the upside targets of 86000-90000