Gold was trading lower in Indian markets on January 15 morning despite a positive trend in international spot prices supported by the stimulus plan of US president-elect Joe Biden.
On the Multi-Commodity Exchange (MCX), February gold contracts were trading lower by 0.24 percent at Rs 49,104 for 10 grams at 0920 hours. March silver was trading 0.8 percent lower at Rs 66,145 a kilogram.
Investors should buy gold on dips towards Rs 49,000 for an initial upside target of Rs 49,500, said experts. Silver is also a buy-on-dips towards Rs 65,800 for a target of Rs 68,000.
Gold and silver closed mixed on January 14 amid volatility in the dollar index and ahead of Biden's speech on the US stimulus.
February gold futures contract settled at $1,851.40 per troy ounce with a loss of 0.19 percent, while silver March contract settled on a positive note at $25.80 per troy ounce. Domestic markets also had a mixed day.
“The US president-elect Joe Biden also unveiled a plan of a $1.5-trillion US stimulus to jumpstart the economy that is struggling from the pandemic. We expect both the precious metals to remain volatile in Friday’s session,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“Gold has support at 49,000-48,770 and resistance at 49,580-49,800 levels. Silver is having support at 65,800-65,100 and resistance at 67,100-68,200 levels,” he said.
Jain suggested buying gold on dips around Rs 49,000 with a stop loss of Rs 48,770 for the target of Rs 49,500 and in silver at around Rs 65,800 with a stop loss of Rs 65,200 for the target of Rs 68,000 levels.
Trading strategy
Sriram Iyer, Senior Research Analyst at Reliance Securities
International spot gold and silver prices ended higher on January 14 supported by a weak dollar and dovish comments from Fed chief Jerome Powell.
Domestic gold and silver ended mixed, with the yellow metal ending lower and silver made small gains. Powell said an interest rate hike is coming "no time soon" and pushed back against suggestions that the central bank might start tapering its bond purchases soon. The US dollar index slumped after the comments.
Biden unveiled a $1.9-trillion stimulus package proposal, saying that bold investment was needed to shore up the economy and speed up response to the coronavirus pandemic.
Domestic bullion could trade flat to higher on January 15 morning, tracking international prices.
Technically, MCX February gold has bounced back from Rs 48,750 levels, where it ended above Rs 49,000. However, resistance remains near Rs 49,500-49,800. Support is at 48,900-48,750 levels.
MCX March silver bounced back from 64,900 levels where it ended on a positive note above 66,400, indicating a positive momentum up to 67,350-68,040. Support is at 65,400-64,600.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities.
Comex gold was trading changed near $1,851 after a 0.2 percent decline the previous day. Gold was choppy as support from rising virus cases, disappointing US economic data and hopes of higher US stimulus was countered by higher US bond yields, vaccine progress and continuing ETF outflows.
Gold may remain choppy along with the dollar and equity markets as implications of higher US stimulus are assessed. The general bias may be on 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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