Gold prices were up in India on August 31, tracking positive cues in the international spot prices where the precious metal was trading near its highest level in nearly two weeks, as a weaker dollar and the US Federal Reserve’s new policy framework boosted demand.
On the Multi-Commodity Exchange (MCX), October gold contracts were trading higher by 0.2 percent at Rs 51,560 per 10 gram at 0920 hours. September silver futures were trading at Rs 67,300 per kg, up 2 percent.
In the international market, spot gold was trading near $1,971.68 per ounce, after hitting its highest since August 19 at $1,976 in early Asian trade. However, gold is down nearly 0.2 percent, so far, this month.
Experts are of the view that gold and silver prices are likely to remain volatile but weakness in the dollar index could support the prices. Support is placed at Rs 51,100-50,800.
At the Comex division, gold settled at $1,973 per troy ounce with weekly gains of 1.19 percent and silver settled at $27.595 per troy ounce with weekly gains of 3.24 percent.
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On MCX, both the precious metals settled on a weaker note last week due to strength in rupee. The Indian current gained 2.42 percent and reached a five-month high against the dollar.
Gold prices in the domestic market settled at Rs 51,448 per 10 gram with weekly losses of 1.35 percent and silver at Rs 68,837 per 1 kilogram with weekly losses of around 1.50 percent.
“We expect the dollar index to show further weakness in the coming days and will continue to support both the precious metals in international markets. We expect both the precious metals to remain volatile this week and weakness in the dollar index could support prices in international markets,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“At MCX, gold is having support at 51,100-50,800 levels and resistance at 51,800-52,220 levels. Silver is having support at 67,900-67,200 levels and resistance at 69,500-70,100 levels,” he said.
Precious metals could remain volatile during the week and move in both directions but would get support at lower levels, Jain said.
Expert: Sriram Iyer, Senior Research Analyst at Reliance Securities
International gold and silver rebounded on August 28 as the dollar tumbled after Fed chairman Jerome Powell's speech.
The US dollar index fell as the Federal Reserve's new policy framework suggested that interest rates would remain low.
Domestic gold and silver rose on August 28, tracking firm overseas prices. Domestic bullion could trade flat-to-higher on August 31, tracking a positive start in the overseas prices.
Technically, MCX October gold could start with gains, and trade above 51,350 will continue upside movement.
Markets could remain volatile and remain within a range of 51100-51800 levels. Resistance holds at 51900-52100 level and Support is at 50800-50500 levels.
Expert: Ravindra Rao, VP- Head Commodity Research at Kotak Securities
Comex gold was trading marginally higher near $1978/oz after a 2.2 percent rally in the previous session. Supporting gold is a weaker dollar and concerns about rising virus cases and increased US-China tensions.
However, weighing on price is a lack of ETF buying and sharp discounts in Indian and Chinese physical markets. Gold may continue to trade with a positive bias unless there is some recovery in the US dollar.
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