Gold Prices Today: Range-bound movement on the cards, buy on corrections

Gold Prices, Silver Prices

Gold prices inched higher on November 17 but hovered around a recent low after a jump in US retail sales kept the dollar close to a 16-month high.

On the Multi-Commodity Exchange (MCX), the gold contracts were up 0.14 percent to Rs 49,109 for 10 grams at 9.45 am. Silver futures gained 0.28 percent to Rs 66,419 a kilogram.

Gold and silver showed extreme volatility on Tuesday and dipped after upbeat US retail sales data and strength in the dollar index. Both the metals settled on a weaker note in the international markets.

“We expect both the precious metals to remain volatile in today’s session. Gold is expected to hold $1832 per troy ounce and silver $24.50 per troy ounce levels. Gold has support at $1,844-1,832 per troy ounce and resistance at $1,866-1,878 per troy ounce, while silver has support at $24.70-24.44 per troy ounce and resistance at $25.20-25.55 per troy ounce,” said Manoj Kumar Jain, Prithvi Finmart Commodity Research.

At MCX, gold has support at Rs 48,850-48,660 and resistance at Rs 49,280-49,500, while silver has support at Rs 65,800-65,400 and resistance at Rs 66,660-67,200. “We suggest buying gold on dips around Rs 48,850 with a stop loss of Rs 48,660 for a target of Rs 49,300,” he said.

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Several technical evidences pointing out that gold will likely remain pretty bullish in the near future. The adjoined weekly chart of MCX Dec contract shows that the intermediate downtrend had terminated early in October with a falling wedge pattern. The breakout was accompanied by good volume as well.

The short-term target for gold is now Rs 50,500 (which is the May high). Year-end as well the general trend is likely to be bullish for gold, which fits nicely with the present price action. Corrections will therefore be buying opportunities in gold with a stop loss at supports over Rs 48,870 and Rs 48,200.

The higher US bond yields and stronger dollar pushed gold prices lower on November 16. However, the inflation concerns has increased the safe haven appeal which is providing support to gold prices. This tug of war between bulls and bears is keeping gold in the range-bound zone. We expect gold to show some upward move this week.

Buy zone near Rs 49,100 for a target of Rs 49,500

Sell zone below Rs 49,000 for a target of Rs 48,700

Gold and silver prices showed negative movement on November 16. On the MCX, the December gold contracts closed down 0.53 percent at Rs 49,038 for 10 grams, while the December contract for silver futures closed at Rs 66,234 a kilogram, down 0.49 percent.

Yesterday, we saw some profit-booking in bullions at higher levels. As per technical chart, the overall structure of gold and silver are positive and strong, momentum indicator RSI also hints at it on the daily chart. So, traders are advised to create fresh longs on small dips near given support levels, traders should focus important technical levels.

December gold closing price Rs 49,038, Support 1 - Rs 48,900, Support 2 - Rs 48,700, Resistance 1 - Rs 49,370, Resistance 2 - Rs 49,725.

December silver closing price Rs 66,234, Support 1 - Rs 66,000, Support 2 - Rs 65,500, Resistance 1 - Rs 67,000, Resistance 2 - Rs 67,750.