Buy MCX Gold, says Karvy Commodities

Karvy Commodities Broking has come out with its report on bullion. According to the research firm, the rupee is trading flat today and expected to continue trading in a sideways pattern which may not have any significant impact on MCX gold. One can buy Gold at the MCX platform.

Gold: This morning, gold is trading at $1614, just below the strong resistance level of $1620. We expect that gold should probably be breaching the same either today or early in the next week. As discussed in our previous report, ETF buying by investors at the SPDR gold trusts (largest ETF in the world) is marginally improving this week. In the last day, net total tonnage stood at 1222.45. This might keep gold prices afloat. However, a weakness in the euro is restricting gold’s gain. The Cyprus development has been the key concern this week while the results of the FOMC failed to play any major role in the market. Today being the last day of this week, we expect a very lackluster performance in all the asset classes, so we don’t expect any volatility in gold either.

There are no major data expected today except for a few IFO sentiment numbers from Germany which are likely to improve a little. However, we do not foresee any strong revival in the euro. There is no data expected from the US today so, investors might stay cautious while the markets maintains a holding pattern. The popular opinion is to stay on the buying side for gold, leading us to expect a breach of the $1620 mark in gold soon. We recommend buying for the day. The rupee is trading flat today and we expect it to continue trading in a sideways pattern which may not have any significant impact on MCX gold. We also recommend buying gold at the MCX platform.

Silver: This morning, spot silver is trading at $29.10, largely unchanged from its previous close. We are expecting a lackluster day for silver, like gold, as well, but recommend buying on dips. There are no major events today except the IFO numbers from Germany which are expected to rise, offering little support to silver. During the US session, we expect the market to stay sideways and dull as no events or data are expected. Overall, we expect silver to trade marginally higher but, a likely loss in base metals might restrict gains in the precious metal.

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