Gold prices were steady at Rs 50,442 per 10 gram in the Mumbai retail market on rupee appreciation and negative global cues. The precious metal lost Rs 3,534, or 6.55 percent, in September but was up 28.55 percent year-to-date.
The rate of 10 gram 22-carat gold in Mumbai was Rs 46,205 plus 3 percent GST, while 24-carat 10 gram was Rs 50,442 plus GST. The 18-carat gold quoted at Rs 37,832 plus GST in the retail market.
Gold prices came under pressure as the US dollar rebounded after a two-day fall following the US presidential debate and was trading firm at 94.13 or up 0.22 percent against major currencies. Also weighing on the bullion metal is the upbeat US and Chinese economic data.
US House Speaker Nancy Pelosi said she hoped to have a coronavirus aid deal with the White House this week, after speaking with Treasury Secretary Steve Mnuchin.
Gold holdings in SPDR ETF were unchanged at 1268.88 tonnes.
Spot gold was trading down $12.30 at $1,885.74 an ounce at 1223 GMT in London trading.
MCX iCOMDEX Bullion Index fell 186.79 points, or 1.20 percent, at 15,382.53 at 1734 hours. The index tracks the real-time performance of MCX gold and silver futures.
"Gold edged lower and was on track for its biggest monthly decline in nearly four years, as the dollar benefitted from the caution that crept into financial markets after the first US presidential debate between President Trump and former US vice president Joe Biden, while optimism over hopes of a US coronavirus aid deal limited losses,” Navneet Damani, Vice President, Motilal Oswal said.
Market participants will focus on important GDP and private payroll data from the US, which if positive could further put pressure on the metal and create optimism for the non-farm payroll number scheduled on the last day of the week.
The broader trend on Comex could be in the range of $1,875- 1,910 and on the domestic front, prices could hover in the Rs 50,100-50,600 range.
“Comex gold trades lower near $1,888 amid a rebound in the US dollar. The dollar is expected to remain volatile as market focus shifts on the US economy amid the first US presidential debate, efforts to reach consensus on new fiscal stimulus and some important economic indicators. While the overall trend for gold looks sideways to positive, we may see choppiness as there are many uncertain factors like US stimulus plan, EU-UK Brexit negotiations and economic readings from major economies”, said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.
The gold/silver ratio stands at 84.10 to 1, which means the amount of silver required to buy one ounce of gold. The increase in ratio indicates that gold has outperformed silver.
Silver prices decline Rs 396 to Rs 59,974 per kg from its closing on September 29.
In the futures market, the gold rate touched an intraday high of Rs 50,515 and an intraday low of Rs 50,183 on the MCX. For the December series, the yellow metal touched a low of Rs 48,384 and a high of Rs 56,379.
Gold futures for December delivery dropped Rs 392, or 0.77 percent, at Rs 50,260 per 10 gram in the evening trade on a business turnover of 15,334 lots. The same for February edged lower Rs 328, or 0.65 percent, at Rs 50,387 on a business turnover of 462 lots.
The value of the December and February contracts traded so far is Rs 2,332.02 crore and Rs 39.84 crore, respectively.
Similarly, the Gold Mini contract for November slipped Rs 379, or 0.75 percent at Rs 50,350 on a business turnover of 11,231 lots.
Trading strategy
Sriram Iyer, Senior Research Analyst at Reliance Securities
On the charts, LBMA spot gold is trading on a positive note where above $1,880 levels could see upside $1,897-$1,905 as resistance and support is at $1,872-$1,860 levels.
On the charts, MCX October gold contract took resistance near 65-daily moving average placed at Rs 50,570, which could halt further upside. Support is placed at Rs 50,150-49,900.
Anuj Gupta- DVP- Commodities and Currencies Research, Angel Broking
As for today, traders can go buy gold at Rs 50,300 with the stop loss of Rs 50,000 for the target of 50,900.
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