India February Gold futures rose on December 31 tracking gains in the international market as weakness in the dollar countered optimism about the United States and China signing an interim trade deal soon.
Spot gold hit its highest level since Oct. 25 at $1,516.20 on Monday. Gold prices are set to post their best year since 2010, having gained about 18%, mainly driven by a tariff war between the world’s two largest economies and quantitative easing by major central banks, said a Reuters report.
The dollar edged lower against a basket of rivals, making gold cheaper for holders of other currencies. On Friday, the index suffered its biggest one-day fall since March, it said.
On the MCX, Gold contracts for February were trading higher by Rs 170, or 0.44 percent, at Rs 39,141 per 10 gram at 0920 hours.
Gold and Silver prices traded steady in the international market due to weakness in the dollar index on Monday. Upbeat US trade balance and Chicago PMI data limits gain in precious metals.
Experts are of the view that both Gold and Silver are likely to hold on to their crucial supports levels making it a good ‘buy on dips’ strategy. It could face resistance near 39250 levels while supports are placed at 39,000-38,875.
“Due to strength in rupee both the precious metals in the domestic market settled on a weaker note. We expect gold and silver remain to hold key supports of $1500 and $17.55 per troy ounce in the international market,” Manoj Kumar Jain, Director, IndiaNivesh Commodities told Moneycontrol.
“At MCX Gold is expected to hold 38800 and silver is expected to hold 46100 levels. Any downside correction towards 38880 would be an opportunity to buy gold again,” he said.
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Expert: Jateen Trivedi, Sr. Research Analyst – Commodity & Currency at LKP Securities
On the daily chart, Gold traded flat on the back of the year-ending holiday season with little participation globally, but undertone remains bullish. Gold keeps cashing in the delays of signing between the two giants US & China.
The US and China would sign their so-called Phase one trade pact at the beginning of January, subject to not any renegotiation.
Prices overall are in a positive trend market bias. Prices can be in the bullish momentum till the time they are above 38,100 on a closing basis. For the day 39,125-39,250 will act as resistance whereas 39,000-38,875 as supports.
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Source: Money Control