India Gold MCX December Futures trade flat on October 8 amid muted trend seen in the international spot prices. The expectation of a second US stimulus could continue to keep both the precious metals volatile but will find support at lower levels.
Gold tends to benefit from widespread stimulus measures as it is widely viewed as a hedge against inflation and currency debasement, said a Reuters report.
On the Multi-Commodity Exchange (MCX), December gold contracts were trading lower by 0.09 percent at Rs 50,002 per 10 gram at 0930 hours. December silver futures were trading 0.2 percent lower at Rs 60,280 per kg.
It was a roller-coaster day for precious metals. Both the precious metals opened gap-down after the US President halted stimulus talks on Tuesday but renewed stimulus hopes supported precious metals at lower levels.
Gold settled at $1890.80 per troy ounce while Silver settled on a flattish note at $23.922 per troy ounce. Both the precious metals settled on a weaker note in the domestic markets.
“We expect speculation on a second US stimulus could continue to keep both the precious metals volatile but lower levels support is expected in today's session. Gold is expected to hold key support of $1872 per troy ounce and if prices sustain above $1892 per troy ounce could test $1908-1920 troy ounce levels again,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“At MCX, gold is expected to hold key support of 49800 and if prices sustain above 50050 levels could test 50220-50450 levels again. Silver is also expected to hold key support of $23.20 per troy ounce and if prices sustain above $23.90 could test $24.20-24.50 per troy ounce levels again,” he said.
Jain further added that at MCX, Silver is expected to hold key support of 59,500 and if prices sustain above 60,600 could test 61,500-62,200 levels again. We suggest buying on a dip in both the precious metals in today's session.
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Expert: Sriram Iyer, Senior Research Analyst at Reliance Securities
International spot gold and silver ended with marginal gains on Wednesday as investor focus shifted to upcoming minutes from the U.S. Federal Reserve's last meeting for clues on the outlook of monetary policy.
Furthermore, the U.S. Dollar fell from the highs of the session on Wednesday and lifted sentiments.
U.S. Federal Reserve policymakers split over how to apply a new strategy for monetary policy at their September meeting, and, amid growing doubts about the path of the economy, offered no clear sense of their next steps to offset the coronavirus recession, minutes from their September meeting showed.
U.S. President Donald Trump on Tuesday announced a halt in additional stimulus negotiations until after the Nov. 3 presidential election, prompting gold prices to drop nearly 2%. He later suggested that Congress should pass money for airlines, small businesses, and stimulus checks of $1,200 for individuals.
Domestic bullion could trade flat this Thursday morning, tracking the international prices. Technically, MCX Gold December traded on a negative note after giving a gap down open where sentiments remain Bearish throughout the session.
Below 50300 levels, the yellow metal will continue to trade on a negative note. Gold could trade in a range of 49700-50250 levels in the coming sessions.
MCX Silver December has bounced back from 59300 levels and gave a close above 60000 levels indicating some support near these levels.
However, it is expected to trade in sideways to marginal downside momentum in a range of 59500-60700 levels.
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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