The bullion metal lost Rs 2,562, or 4.68 percent, for the week on MCX as investors booked profit (Image courtesy: Reuters)
Gold was trading comfortably above Rs 51,000 per 10 gm on October 12, with experts saying that any dip can be used to go long for a target of Rs 51,100-51,300.
On the Multi-Commodity Exchange (MCX), December gold contracts were trading higher by 0.38 percent at Rs 51,010 per 10 gram at 0920 hours. December silver futures were trading 1.4 percent higher at Rs 63,785 per kg.
On October 9, gold and silver prices extended gains in the international markets with domestic markets follow the global cues. Gold settled at $1,936.40 per troy ounce, with a weekly gain of nearly 2 percent, while silver ended at $25.30 per troy ounce, gaining 6 percent during the week.
On MCX, both the precious metals settled on a positive note. Gold settled at Rs 50,817 per 10 gram and silver at Rs 62,884 per kilogram.
Gold and silver showed solid gains on October 9 amid hopes of a second US stimulus, weakness in the dollar index and on expectations of good physical demand from China, experts said.
“Market is expecting a second stimulus from the US any time before the elections. Gold and silver prices were also lifted on the reopening of China’s markets following a long holiday and the upbeat Chinese economic data that will likely prompt better consumer demand for the precious metals,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“On MCX, gold has strong support at Rs 50,330 per 10 gram and that is expected to hold. If prices sustain above Rs 50,800, the upmove could extend the gains towards 51,100-51,300 levels,” he said.
Silver has support at Rs 61,500 and is expected to hold if prices sustain above Rs 62,800. An upmove can extend the gains towards 63,600-64,400 levels.
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Sriram Iyer, Senior Research Analyst at Reliance Securities
International bullion prices rose on October 9 as the dollar fell to a near three-week low and increased bets for fresh US stimulus pushed investors to bullion.
The Trump administration called on Congress to pass a stripped-down coronavirus relief bill, as talks on a more comprehensive plan were again at an impasse. A new $1.8-billion White House proposal has drawn criticism from both Democrats and Republicans.
Additionally, a widening lead for Democratic presidential candidate Joe Biden has raised the prospect of further stimulus and also weighed on the US currency and supported bullion.
Technically, MCX December gold has formed an Open Bullish Marubozu Candlestick pattern with a breakout above the horizontal trend line indicating a bullish reversal in the counter. Resistance is at 51,000-51,365 levels. Support is at 50,600-50,300 levels.
MCX December silver has formed a Long Open Bullish Marubozu Candlestick pattern after a long congestion phase, indicating a bullish reversal in the counter.
Above Rs 62,300, silver can see a rally up to 63,900-64,600, where support is at 61500-60200 levels.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities
Comex gold was trading modestly higher near $1,933/oz after 1.6 percent gain in the previous session. Gold is being supported by recent weakness in the US dollar and expectations of additional stimulus in the US despite political wrangling.
ETF investors continue to remain on the sidelines, showing a lack of buying interest among investors. Gold may witness choppy trade as market players assess development on the US stimulus deal but general bias may be on the upside because of a weaker dollar.Disclaimer
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