Gold slips Rs 110 to Rs 39,760 per 10 gram, silver dips Rs 195 to Rs 46,180 per kg

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Gold prices slipped Rs 110 to Rs 39760 per 10 gram in the Mumbai bullion market on January 10 on the back of rupee appreciation and as easing tensions in the Middle East boosted sentiment investor appetite for riskier assets. The precious metal had tumbled Rs 970 yesterday after US President Trump retorted Iran’s missile attack with sanctions instead of military action.

The rate of 10 grams 22-carat gold in Mumbai was Rs 36,420 plus 3 percent GST, while 24-carat 10 gram was Rs 39,760 plus GST. The 18-carat gold quoted at Rs 29,820 plus GST in the retail market.

The gold/silver ratio currently stands at 86.01 to 1, which means the amount of silver required to buy one ounce of gold.

Silver prices dipped Rs 195 to 46,180 per kg from its closing on January 9. The precious metal is down Rs 1082 for the week but has been up 1.35 percent for the year. While silver prices eased Rs 1,150 in the same period and down 1.03 percent in 2020.

According to Navneet Damani, Vice President, Motilal Oswal, Gold prices edged lower, declining as much as 1 percent in the yesterday’s session, as de-escalation in US-Iran tensions brought relief to markets and boosted investors' appetite for riskier assets. After the US Iran tensions, market participants have got their focus back on the Phase one deal signing between US and China.

Positive private labor data reported earlier in the week has got the investors focus on the Non-farm payroll data scheduled today. Broader trend on Comex could be $1,530-1,560 and on domestic front prices could hover in the range of Rs 39,400- 40,000, said Damani.

In the futures market, gold rate touched an intraday high of Rs 39,798 and an intraday low of Rs 39,568 on MCX. For the February series, the yellow metal touched a low of Rs 36,098 and a high of Rs 41,293.

Gold futures for delivery in February slipped Rs 198, or 0.50 percent on the MCX trading at Rs 39,632 per 10 gram in evening trade in a business turnover of 12,611 lots. Gold contracts for April delivery eased Rs 182, or 0.46 percent, at Rs 39,818 per 10 gram in a business turnover of 10,094 lots.

The value of the February contract traded so far is Rs 2,906.47 crore and April contract saw the value of Rs 248.20 crore.

Similarly, Gold Mini contract for February was down by Rs 193, or 0.48 percent at Rs 39,613 in a business turnover of 8,965 lots.

Gold price is trading under descending triangle pattern, price is expected to trade negative. Sustaining below Rs 39,700 may drag price lower towards Rs 39,500-39,400 levels, according to Axis Securities.

On hourly chart, price is trading below 9, 21 and 60 EMA which is a bearish sign. The Relative Strength Index at 35 which indicates low momentum in prices.

The brokerage firm advised its clients to sell February gold at Rs 39,700 with stoploss at Rs 39,850 and target of Rs 39,500.

MCX Gold has intraday support at Rs 39,570-39,500 whereas resistance is at Rs 39,885-40,050. Sideways to positive move will be seen for the session, according to Motilal Oswal.

The brokerage firm said spot gold has intraday support at $1,535 whereas resistance is at $1,563-1,575.

At 12:49 pm (GMT), spot gold was down $2.30 at $1,549.52 an ounce in London trading.

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