India Gold October Futures rose marginally higher on September 3 after falling more than 1 percent in the previous session, tracking the positive trend seen in the international spot prices.
International Gold prices edged higher following a steep fall in the previous session, as a weaker US dollar and worries over the global economic outlook due to rising COVID-19 cases underpinned the metal’s appeal, said a Reuters report.
Experts are of the view that both precious metals are likely to remain volatile. In case there is selling pressure then crucial support is placed at Rs 50,330.
On the Multi-Commodity Exchange (MCX), October gold contracts were trading higher by 0.12 percent at Rs 50,884 per 10 gram at 0920 hours. September silver futures were trading flat at Rs 65,784 per kg.
Gold and silver plunged amid sharp gains in the US dollar index. Gold slipped 1.7 percent and settled at $1944.70 per troy ounce and silver plunged 4.3 percent to settle at $27.40 per troy ounce at the Comex division.
At MCX, both the precious metals settled on a weaker note. Gold settled at 50851 (LTP) with a loss of 1.26 percent and silver settled at 68260 (LTP) with a loss of 3.71 percent.
“Dollar index gets support from the weakness in the Euro and other European currencies. We expect both the precious metals to remain volatile and could get support at lower levels. Gold is having strong support at $1,910 per troy ounce and silver is having support at $26.90 per troy ounce and expected to be hold,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“Gold is having resistance at $1,966-1,984 per troy ounce and silver is having resistance at $27.80-28.20 per troy ounce. At MCX, gold is having support at Rs 50,300 on a closing basis and resistance at Rs 51,100-51,330 levels,” he said.
Gold prices were also weighed down by hopes of a speedy recovery in growth prospects after data showed a strong rebound in the US manufacturing sector.
US private payrolls, on the other hand, increased less than expected in August, pointing to a slowing labour market recovery.
Domestic gold crashed over 1% and silver crashed by over 3% on Wednesday, tracking weak overseas prices. Domestic bullion could well trade flat this Thursday, tracking a subdued start in the overseas prices.
Technically, MCX Gold October has formed a Bearish Candlestick where 51555 levels acted as a resistance.
Moreover, prices ended on a negative note where it closed below its 50-Daily Moving Average indicating a bearish trend. Support holds at Rs 50260-49800 levels and Resistance is at Rs 51200-51700.
Expert: Ravindra Rao, VP- Head Commodity Research at Kotak Securities
COMEX gold trades modestly higher near $1952/oz after a 1.7% decline yesterday. Gold edged up gaining support from increased US-China tensions, mixed US economic data, and Fed’s dovish stance.
However, weighing on price is persistent strength in global equity markets, ETF outflows, and weaker consumer demand. Gold may remain choppy amid lack of clear cues however Fed’s dovish stance may limit the upside in the US dollar and this may keep gold prices supported.