India’s gold prices for April fell on March 27, tracking weakness in the international spot prices as investors booked profits after prices hit a two-week high in the last session amid hopes of further economic stimulus to alleviate the coronavirus pain.
“The yellow metal was up 8.2 percent for the week, its biggest since December 2008, on weak US unemployment data and the Federal Reserve's unprecedented economic stimulus measures,” said a Reuters report.
“The number of Americans filing claims for unemployment benefits surged to a record of over 3 million last week as strict measures to contain the virus brought the country to a sudden halt.”
On the Multi Commodity Exchange (MCX), April gold contracts were trading lower by 351, or 0.81 percent, at Rs 43,191 per 10 gram at 0930 hours.
The precious metal is likely to remain volatile but experts say that investors should maintain a buy on dips approach amid profit-taking at higher levels. The next target for the metal is placed at Rs 43,500.
Trading strategy:
Expert: Sriram Iyer, Senior Research Analyst from Reliance securities
International gold is trading with a bullish crossover of 21, as well as 50-Daily Moving Averages, indicating a positive trend as far it sustains above $1,585. The upside rally can be expected up to $1,674-$1,705 levels.
MCX Gold April gave a sharp rally above 44,500 levels with an increase in volume activity, which suggests that a strong uptrend will continue up to the 44,900-45,300 level.
However, sideways momentum can be expected if it drops below 42,700, where 40,800 will hold strong support to the counter.
Intraday strategy: Buy April old in the 42,900-42,950 range, with 42,700 as stop loss and target of 43,500.
Expert: Jateen Trivedi, Senior Research Analyst (Commodity & Currency), LKP Securities
On the daily chart, gold prices rose on March 26 as the record $2-trillion US stimulus package itself would have been enough to make gold bugs glow.
The major moving average such as 20, 50, 100-days EMA are suggesting range trades. Overall, the trend remains positive till the time 39,500 holds on a closing basis but volatile sessions will be seen with some profit booking on rallies.
For the day 43,650-43,950 will act as resistance, whereas 43,275-42,925 as supports.
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