India Gold April Futures were trading higher on February 12 but gains remain capped after China's senior medical adviser suggested the coronavirus epidemic may be over by April.
However, the uncertainty over the impact of the outbreak supported the safe-haven metal. Spot gold was flat at $1,567.62 per ounce in early trade, said a Reuters report.
On the MCX, April gold contracts were trading higher by Rs 14, or 0.03 percent, at Rs 40,424 per 10 gram at 0920 hours.
MCX April Gold and silver prices witnessed profit-taking on Tuesday due to strength in the dollar index and rebound in global equities. In the short term, investors could deploy buy on dips strategy for a target of Rs 40,500 per 10 gm, suggest experts.
“Fear of coronavirus persists in global economies and Goldman Sachs also downgrade Chinese GDP from 5.8% to 5.2% for the year 2020. We expect lower level buying in both the precious metals,” Manoj Jain, Director, India Nivesh Commodities told Moneycontrol.
“Gold buying is expected around 40,300 and it could rebound again towards 40,500-40,580. Silver is expected to see buying around 45,500-45,400 zone and it could rebound again towards 45,850-46,000 levels. Rs 40,180 for gold and Rs 45,100 for silver will be crucial support levels,” he said.
Trading Strategy
Expert: Sriram Iyer, Senior Research Analyst, Reliance Commodities
MCX Gold April contract corrected in the last session and closed on the negative note. This has made bearish candlestick pattern on the daily chart which suggests sideways to negative action to continue.
LBMA Gold spot has been intact in the range of $1,560 and $1,575 and fresh Breakout is awaited.
Intraday strategy: MCX Gold April buy on dips towards 40350-320 with Rs 40,240 as stop loss and target of Rs 40,520.
Expert: Jateen Trivedi, Senior Research Analyst (Commodity & Currency), LKP Securities
On the daily chart, Gold prices were flat on Wednesday as equities ticked up after China's senior medical adviser suggested the coronavirus epidemic may be over by April, although uncertainty over the impact of the outbreak supported the safe-haven metal.
Overall, the trend remains positive with some overhang at higher levels of 41,000-41,300. The RSI & MACD indicators are signalling volatility. For the day, 40,500-40,640 will act as resistance whereas 40,325-40,175 will be supports.
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