Gold Price Today 16-03-2021: Yellow metal rate near Rs 45K; precious metal may shine further after breaking this resistance, say experts

Gold Price Today 16-03-2021: The precious yellow metal rate rose Rs 160 per 10 gm at MCX (Multi Commodity Exchange) today morning and hit Rs 44,910. The bullions experts are of the opinion that gold has strong support at $1650 per ounce in the international market and at the same time it is facing stiff resistance at $1720 to $1730 per ounce levels. At MCX they advised that gold price is facing resistance at Rs 45,600 per 10 gm levels. Once, the yellow metal manages to break this level, there can be fresh momentum we can witness in the yellow metal rates. 

Speaking on the gold price outlook in the long-term Amit Sajeja, Vice President — Research at Motilal Oswal said, "In the international market, gold price has strong support at $1,650 per ounce levels. I would advise gold investors to take positional calls when the gold price breaks $1,750 per ounce resistance and sustains above $1,760 per ounce levels. Till then 'buy on dips' is the strategy when gold price falls around $1,660-70 per ounce levels. In gold price MCX terms, one should start aggressive buying if the gold price breaks Rs 45,600 per 10 gm resistance as it would be an indication of gold price bottoming out."

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However, gold investors need to reamin vigilant about the current threats working against the gold rally these days.

Amar Ambani, Senior President and Head of Research – Institutional Equities, YES SECURITIES said, "Gold is discernibly in the grip of a classical bear phase, which is prone to last for a long time frame. In the present environment, stocks are way better placed. Even within the commodity space, industrials appear visibly stronger, with China demand, falling inventory, global recovery prospects, as also the big EV and the renewable opportunities."

Bitcoin bites gold rally
"Furthermore, Bitcoin to an extent has cannibalized demand for Gold, given its inherent value prop of high liquidity, secure custody and limited issuance. If speculative interest in Gold is also anything to go by, an equivalent of 200 tons of net long positions, representing 15% of open interest, have been cut. Gold holdings in SPDR Trust have also fallen to lowest level since May 2020," said Amar Ambani of YES SECURITIES.

Rupee vs dollar
Ambani went on to add, "In fact, in local currency terms, Gold may depreciate even more if the Indian Rupee were to appreciate. We expect a stable to gradual appreciating INR over next four years, which means lower Gold price in Rupee terms. Our target price for Gold is $1200. This is clearly an era to place one’s faith in riskier assets. ‘Golden’ times will recur for sure in the distant future but as of today, given the better opportunities in other asset classes, the conclusion seems foregone: in the safety net dictum of Gold, we trust, but any current investment into it is more likely to rust."