Gold prices edged lower on October 26 weighed down by an uptick in the dollar as investors wait for the key central bank meetings this week. On the Multi-Commodity Exchange (MCX), the gold contracts were down 0.12 percent to Rs 48,144 for 10 grams at 9.53am.
Gold Prices Likely to Stay Volatile
December silver futures were down 0.31 percent to Rs 65,937 a kilogram. Gold stood at Rs 48,200. It is in a bullish trend after it broke the major resistance level of Rs 47,170. Strategy for trading in gold should be to buy at support levels.
Gold can find support at around Rs 47,120 and Rs 47,540 levels. Target for gold, based on the width of bearish channel it made previously, can be around Rs 48,600 to Rs 48,650. Resistance levels in gold are at Rs 48,300 and Rs 48,700, said Manoj Dalmia, Founder and Director- Proficient Equities.
COMEX gold trades marginally lower near $1805/oz after a 0.6 percent gain yesterday. Gold has rescaled $1800/oz, indicating upward momentum and remains supported by inflation concerns, growth worries, and renewed virus concerns.
However, weighing on price is continuing strength in equity markets and weaker investor interest as is evident from ETF outflows. Gold may continue to witness choppy trade amid mixed factors, however, general bias may be on the upside amid increasing challenges to global economy.
Gold prices in COMEX has breached the resistance of $1,800, which indicates bullish momentum will remain intact in prices. It is likely to test $1,830-1,835. Lower rig count data of Crude oil and natural gas ramping up the possibility of rising inflation. Gold prices rose around 1 percent on October 25, while the US 10-year bond yield fell 1.63 percent. In MCX, gold has resistance at Rs 48,300-48500 and above this level it may test Rs 49,000. Support in gold is seen at Rs 47,900.
Silver and gold prices extended gain on October 25 amid rising global inflation due to higher energy prices. Both the precious metals settled on a positive note in the international markets. The Gold December futures contract were settled at $1806.80 per troy ounce with a gain of 0.75 percent and silver December futures contract were settled at $24.59 per troy ounce with a gain of 0.83 percent. We expect both the precious metals to remain positive and any decline in the prices would be a buying opportunity at lower levels.
We expect gold prices to test $1,832 per troy ounce while silver prices could test $25 per troy ounce levels this week. Gold has support at $1,796-1,784 per troy ounce and resistance at $1,818-1,832 per troy ounce and silver has support at $24.20-24.00 per troy ounce and resistance at $24.88-25.10 per troy ounce. At MCX, gold has support at Rs 48,000-47,860 and resistance at Rs 48,440-48,700 and silver is having support at Rs 65,700-65,220 and resistance at Rs 66,660-67,200.
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