India Gold October Futures rose slightly on September 22 tracking the positive trend seen in the international spot prices, a day after the index fell more than 2 percent.
On the Multi-Commodity Exchange (MCX), October gold contracts were trading higher by 0.20 percent at Rs 50,570 per 10 gram at 0930 hours.
Experts are of the view that although the trend is slightly on the higher side but the yellow metal could face resistance near Rs 50,660 and on the downside support levels are placed at Rs 50,000-49,800.
Gold and silver prices crashed on Monday tracking gains in the US Dollar index and heavy sell-off in global equities. Global banking concerns, fear of the second phase of lockdown in European countries pushed global equities lower that supported the US dollar index.
Uncertainty on further stimulus from the US Federal Reserve also pushed both the precious metals lower. The US Dollar index rebounds to 93.80 mark again.
Gold prices slipped 2.36 percent and settled at $1911.60 per troy ounce and silver tumbled 9.53 percent and settled at $24.39 per troy ounce. At MCX, gold settled at 50471 per 10 gram with a loss of 2.41 percent and silver settled at 61316 per one kilogram with a loss of 9.67 percent.
Both the precious metals crashed amid concerns over HSBC Bank, uncertainty on further stimulus from US federal reserve, rebound in the dollar index, fear of the second phase of lockdown in the EU, suggest experts.
“Global growth concerns and geopolitical tensions are supporting precious metals at lower levels. We expect both the precious metals remain volatile today and it's in the oversold zone some rebound in the prices are expected in today's session,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“If the dollar index gained further could again push both the precious metals lower, it is a sell on the rise market for both the precious metals. Gold is having resistance at $1922-1940 per troy ounce and support at $1892-1878 per troy ounce,” he said.
Jain further added that at MCX, Gold may face resistance near 50660-50800 and on the downside support exists at 50000-49800 levels.
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Expert: Sriram Iyer, Senior Research Analyst at Reliance Securities
International bullion tumbled on Monday tracking gains on the U.S. Dollar and uncertainty over more U.S. fiscal stimulus. U.S. and China tensions saw investors move their investments to U.S Dollar, rather than gold or silver.
Domestic gold and silver tumbled on Monday, tracking weak overseas prices. Domestic bullion could trade flat on Tuesday, tracking the international prices.
Technically, MCX Gold October gave a sharp correction below its 21-Daily Moving Average which is placed at 51400 levels below which will continue downside momentum up to 49800-49500levels. Resistance holds at 50700-50900 levels.
MCX Silver December contract corrected more than 10% and is trading around 61550 levels indicating a negative trend to continue 58600-56000 levels.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities.
COMEX gold trades marginally higher near $1915/oz after a 2.6% decline yesterday. Firmness in the US dollar has pressurized gold price however supporting prices is sharp ETF inflows and increasing concerns about the health of US and European economies.
Gold fell sharply along with other commodities however we may see recovery soon as the price has managed to hold near $1900/oz level while the US dollar may be pressurized by concerns about the health of the US economy and the Fed's dovish stance.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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