Gold prices in India traded a little lower on the Multi Commodity Exchange (MCX) Tuesday amid a positive trend in the international spot prices after the announcement of the US fiscal stimulus package. However, a rebound in the US dollar index pressured the yellow metal prices.
At 11:20 am, gold futures for February delivery fell 0.27 percent to Rs 50,278 per 10 grams as against the previous close of Rs 50,416 and opening price of Rs 50,527 on the MCX. Silver futures traded 0.82 percent lower at Rs 68,450 per kg. The prices opened at Rs 69,797 as compared to the previous close of Rs 69,018 per kg.
The US House of Representatives voted to pass a $900 billion coronavirus aid bill, also attached to federal agency spending to avert a government shutdown.
Moreover, fresh restrictions forced by a new coronavirus strain in the UK provided support to the safe-haven metal.
“Gold prices were volatile as the new coronavirus strain and US stimulus package lent support while strength in the dollar index capped the upside in yellow metal prices,” said Ajay Kedia, Director, Kedia Commodity Comtrade.
The US currency strengthened against the basket of currencies as the impact of the pandemic widened in European nations which boosted appeal for the safe-haven dollar.
International gold prices gained on Tuesday as a US coronavirus aid package set for Senate approval boosted the metal’s appeal as an inflation hedge, while a new coronavirus strain shutting down much of Britain lent further support, Reuters reported.
Spot gold rose 0.4 percent to $1,882.94 per ounce, after slipping as much as 1.3 percent in the previous session as the new coronavirus strain rattled markets and investors opted for the dollar. US gold futures rose 0.3 percent to $1,888.90 per ounce.
Analysts believe that both the precious metals could remain volatile going ahead. Gold may find resistance at the $1,900 level.
“On MCX, support for gold is placed at Rs 49,850 level while resistance is seen at Rs 51,100 level. Silver may find support at Rs 67,800 level and resistance at Rs 70,200 level,” Kedia said.
Anuj Gupta- DVP- Commodities and Currencies Research, Angel Broking expects gold prices to trade higher in today’s session.
“As for today traders can buy gold at Rs 50,200 levels with the stop loss of Rs 49,900 levels for the target of Rs 50,800 levels. They can buy silver at Rs 68,000 levels, with the stop loss of Rs 67,000 levels and for the target of Rs 69,800 levels,” Gupta said.
In the international market, Gupta is of the view that gold may test $1,920 levels and silver may test $28 levels soon.
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