Gold prices rose in India on December 8 with the metal trading comfortably above Rs 50,000 per 10 gm, tracking positive trend in international spot prices.
On the Multi-Commodity Exchange (MCX), February gold contracts were trading higher by 0.29 percent at Rs 50,090 per 10 gram at 0920 hours. March silver was trading 0.15 percent lower at Rs 65,398 per kilogram.
Experts are of the view that investors should use the dips, if any, to buy into precious metal. Gold could face some resistance at around Rs 50,100, while silver could face some hurdle near Rs 66,100.
Gold and silver rebound from their lows on December 7 amid hope of a second stimulus in the United States, US-China tensions and a breakdown in Brexit talks between the UK and Eurozone, they say.
The dollar index also cooled off after early gains and supported both the precious metals. February gold futures contracts settled at $1,866 with a gain of 1.30 percent and March silver contracts settled at $24.79.
“Gold and silver also get support from US Congressional leaders who are close to agreeing on a second financial stimulus package in the United States. Markets are also a bit edgy on weekend news the UK and the European Union are still far apart on a smooth Brexit plan,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“We expect both the precious metals to remain firm and any dips in the prices would be an opportunity for buying at lower levels. Gold has support at $1,854-1,840 per troy ounce and resistance at $1,884-1,900,” he said.
On MCX, gold has support at Rs 49,700-49,550 and resistance at Rs 50,100-50,350 levels. Silver has support at Rs 64,800-64,500 and resistance at Rs 66100-66500 levels. “We suggest buying on dips in both the precious metals,” he said.
Trading strategy
Sriram Iyer, Senior Research Analyst at Reliance Securities
International gold and silver prices rose on December 8 supported by expectations of fresh fiscal stimulus in the US. Domestic gold and silver surged higher, taking a cue from firm overseas prices.
Domestic bullion could trade flat to marginally higher on December 8, tracking the international prices.
Technically, MCX Gold February gave a breakout with huge volume activity indicating a strong momentum in the counter. In addition, it has given a breakout above Rs 49,500 levels where further upside could see Rs 50,080-50,300 levels. Support is at Rs 49,700-49,500.
MCX Silver March bounced back from Rs 62,380 and gave a close above Rs 65,300 with more than 2.5 percent gains. Resistance is near Rs 66,350-67,200 and support at Rs 64,600-63,300 .
Ravindra Rao, VP- Head Commodity Research at Kotak Securities.
COMEX gold trades mixed near $1,865 after gaining 1.4 percent the previous day. Gold was trading mixed as support from a general weakness in the US dollar, increased expectations of US stimulus, rising virus cases, mixed economic data from major economies, US-China tensions, and Brexit uncertainty was countered by optimism over the vaccine and continuing ETF outflows.
Gold has rallied sharply in the last few days. While a break above $1,850 has opened path for extended gains, vaccine progress and continuing ETF outflows could limit the upside.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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