India Gold MCX December futures trade lower on Monday, following muted trend seen in the international spot prices amid strength in the US Dollar.

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The dollar index hovered close to a 16-month high, pressuring bullion by increasing its cost to buyers holding other currencies, said a Reuters report.

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On the Multi-Commodity Exchange (MCX), the December gold contracts were trading 0.37 per cent lower at Rs 49,131 per 10 grams at 0930 hours. The December silver futures were trading 1.05 per cent lower at Rs 66,440 a kilogram.

On Friday, gold and silver prices settled on a positive note in the international markets. Gold December futures contract settled at $1,867.85 per troy ounce and silver December futures contract were settled at $25.41 per troy ounce. Domestic markets settled on a positive note on Friday.

Gold and silver gained last week after an unexpected rise in US inflation. The US inflation hit record highs of 31 years and pushed precious metals higher. Gold hits five-month highs and silver prices also hit three-month highs.

Despite strength in the dollar index both the precious metals skyrocketed last week. Gold and silver give long term price breakout on technical charts and show strong positive momentum, suggest experts.

“Looking at the fundamentals and technical prices breakout further rally in both the precious metals cannot be ruled out. We expect gold prices could test $1892 per troy ounce levels and silver prices could also test $26.20 levels in the upcoming sessions,” Manoj Kumar Jain, Director, Head-Commodity & Currency Research, Prithvifinmart Commodity Research, said.

Gold has support at $1854-1840, while resistance at $1878-1892 per troy ounce. Silver has support at $25.10-24.84, while resistance is at $25.70-26.00 per troy ounce.

“At MCX, Gold has support at 49100-48850 and resistance at 49550-49700; silver has support at 66600-66200 and resistance at 67700-68200,” he said.

Jain suggests buying gold on dips around 49100 with a stop loss of 48850 for the target of 49700 and silver around 66600 with a stop loss of 66000 for the target of 68000.

Technical Indicators:

Expert: Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities

COMEX gold trades modestly lower near $1863/oz after a 0.2% gain yesterday. Gold has tested June highs but is struggling to build momentum as support from increased demand as an inflation hedge and choppiness inequities are countered by firmness in the US dollar index, fear of Fed’s monetary tightening, and weaker investor interest.

Gold has stalled near $1870/oz level and unless there are fresh triggers, the price may remain choppy. Dips might attract buying.

Expert: Sriram Iyer, Senior Research Analyst at Reliance Securities

International gold and silver prices ended higher on Friday supported by weak consumer sentiment data in November.

The University of Michigan Consumer Sentiment Index tumbled to 66.8 for November, representing the lowest level in 10-year and the most significant factor behind the drop-in sentiment was inflation.

The US Dollar fell after the data and lent support to bullion. Domestic gold prices could start with cuts this Monday morning, tracking a weak start in overseas prices.

Technically, if MCX Gold December trades above 49,200 it could test the resistance zones at the 49,400-49,600 levels. Support zones is 49,150-48,900 levels.

International silver prices have started weak this Monday morning in Asian trade.

Technically, if COMEX Silver December trades above $25.00 levels, it could witness an upside momentum up to the resistance zones at $25.33-$25.65 levels. Support zones is at $24.88-$23.30 levels.

Domestic silver prices could start weak this Monday morning, tracking weak overseas prices.

Technically, if MCX Silver December trades above 67,000, it could test the resistance zones at 67,700-68,200 levels. Support zones is at 66,400-65,800 levels.

(Disclaimer: The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)