Gold price in India dropped sharply on Tuesday. On the Multi-Commodity Exchange (MCX), the gold contracts tanked 0.20 per cent to Rs 47,818 for 10 grams at 1030 hours on December 7. Silver, another precious metal remained flat on Tuesday. Silver futures were down by 0.09 per cent to Rs 61,213 for 100 grams.
The yellow metal prices were flat in the international market. The firmer dollar and US Treasury yield weighed on gold’s appeal in the global market. Spot gold eased at $1,778.79 per ounce by 0130 GMT while US gold futures were flat at $1,780.00, according to Reuters.
Comex gold prices declined 0.16 per cent on Monday amid elevated US treasury yields and stronger dollar index. The dollar index surged 0.34 per cent on Monday amid rising expectations that the US Federal Reserve could reduce its asset purchases at a faster pace and may quickly raise interest rates in the next year amid signs of higher inflation. The sudden rise in dollar index has made bullion more expensive for holders of other currencies. US benchmark 10 year treasury yields rose to 1.39, increasing the opportunity cost of holding non yielding bullion.
MCX gold prices are likely to trade in a range of Rs 47,800 to Rs 48,200 levels with a mixed bias on the back of rise in risk appetite in the US markets and elevated US treasury yields. However, a sharp downside may be prevented on weakness in rupee against dollar, said ICICI Direct Research in a note.
Ravi Singh, vice President & Head of Research ShareIndia, said, “Gold prices in MCX is trading on cues from international rates. The new variant Omicron has put a break on the domestic wedding demand till further clarity on the severity of the variant and it’s outbreak. The traders are weighing more on the early tapering by Fed after data suggested the labour market was rapidly tightening, pushing gold to choppy zone. Buy Zone Above – Rs 48,000 for the target of Rs 48,500. Sell Zone Below – Rs 47,700 for the target of Rs 47,400.”
“Gold and silver showed mixed movement on the December 6 trading session, On the Multi-Commodity Exchange (MCX), February gold contracts closed slightly up by 0.02 per cent at Rs 47,914 for 10 grams. While March contract Silver futures closed at Rs 61,516 a kilogram, 0.40 per cent down. Yesterday February gold made a high of Rs 48,039 then made a low of Rs 47,830, And Silver made a high of Rs 61,719 then made a low of Rs 60,837. Now a days we are seeing huge volatility in bullions and this may continue for full month of December,” said Amit Khare, AVP- research commodities, Ganganagar Commodity Limited.
As per technical chart gold and silver both are trading at oversold zone. Momentum indicator RSI also indicating the same in hourly as well as daily chart, The current levels are the best prices for short term investors, So short term investors are advised to create fresh longs for in small dips near given support levels, traders should focus important technical levels given below for the day: February Gold closing price Rs 47,914, Support 1 – Rs 47,750, Support 2 – Rs 47,500, Resistance 1 – Rs 48,055, Resistance 2 – Rs 48,200. March Silver closing price 61270, Support 1 – Rs 60,600, Support 2 – Rs 60,000, Resistance 1 – Rs 62,000, Resistance 2 – Rs 63,000,” said Khare.