Gold prices in India traded flat with a negative bias on the Multi Commodity Exchange (MCX) Tuesday tracking a muted trend in the international spot prices as optimism over the COVID-19 vaccine was offset by concerns over rising pandemic cases globally, analysts said.
At 11:55 am, gold futures for December delivery eased 0.01 percent to Rs 50,825 per 10 grams as against the previous close of Rs 50,830 and opening price of Rs 50,800 on the MCX. Silver futures traded 0.24 percent lower at Rs 63,539 per kg. The prices opened at Rs 63,690 as compared to the previous close of Rs 63,691 per kg.
“The gold prices have seen a massive rally in recent days on strong fundamentals. However, the rally in the yellow metal prices may not sustain as we expect profit booking at higher levels,” said Ajay Kedia, director, Kedia Commodity Comtrade.
Bullion dropped as much as 1.3 percent on Monday after drugmaker Moderna said its experimental vaccine was 94.5 percent effective in preventing COVID-19 based on interim data from a late-stage trial, becoming the second US drugmaker after Pfizer to report results exceeding expectations, Reuters reported.
“Development on the front of the Coronavirus vaccine put pressure on gold and silver as the safe-haven demand may fade out. Supply also expected to rise in the coming days from the major gold mines as workers may return and resume production of the metal,” said Anuj Gupta, DVP- Commodities and Currencies Research, Angel Broking.
On Tuesday, international gold prices edged a little higher as the dollar slipped, while investors weighed concerns over spiking coronavirus cases globally against optimism over positive developments around a second possible COVID-19 vaccine.
Spot gold rose 0.1 percent to $1,890.27 per ounce, while US gold futures were up 0.1 percent at $1,889.70.
According to Gupta, the trend of gold and silver now become sideways to down and the expectation of safe-haven demand of this asset may fade out.
“As for today, traders can sell gold at Rs 51,000 levels with the stop loss of Rs 51,300 levels for the target of 50,500 levels. They can also sell Silver at Rs 64,000 levels, with the stop loss of Rs 64,600 levels and for the target of Rs 62,800 levels,” Gupta added.
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