New Delhi: Gold prices edged down at open, and were stuck in a tight range on Friday, amid thin trading.
Bullion prices dropped fter US economic data highlighted the country’s economy rebounded faster than previously estimated, boosting the dollar and potentially setting the Fed on a keener path to fight inflation.
Gold futures on
were trading lower by 0.14% or Rs 74 at Rs 54,447 per 10 grams. On the contrary, silver futures gained 0.37% or Rs 254 at Rs 68,774 per kg.
High-interest rates have weighed on gold’s traditional status as a hedge against inflation and other uncertainties this year, as they translate into a higher opportunity cost of holding the non-yielding metal.
“Gold prices erased their gains and ended on a weaker note as strong US GDP numbers increased hopes of further tightening by the FOMC,” said ICICIDirect Research.
“Gold prices are expected to trade with a negative bias today amid a recovery in the dollar and rise in US 10-year treasury yields,” it said. “Investors will remain cautious ahead of US Core PCE price index numbers,” it added.
Meanwhile, top gold consumer China reported 3,761 new symptomatic Covid-19 infections on December 22, compared with 3,030 a day earlier.
In the spot market, the highest purity gold was sold at Rs 54,699 per 10 grams while silver was priced at Rs 67,605 per kg on Thursday, according to the Indian Bullion and Jewellers Association.
The spot prices of gold have jumped about Rs 2,000 per 10 grams since the beginning of December, whereas silver has gained over Rs 5,700 per kg in the same period under review.
NS Ramaswamy, Head of Commodities,
Securities, said that the gold is trading lower after previous session fall as market participants await for US inflation data due later in the day to gauge the Federal Reserve’s rate hike stance.
“Yellow metal fell more than 1% after the US GDP number showed better-than-expected numbers indicating the economy rebounded faster in the third quarter, rising 3.2% against the previously estimated 2.9%,” he added.
Trading Strategy
“We expect bullion prices to remain volatile in today’s session. Gold has support at $1,784-1,772 while resistance is at $1,812-1,822. Silver has support at $23.42-23.25, while resistance is at $23.88-24.05,” said Rahul Kalantri, VP Commodities, Mehta Equities.
In rupee terms, gold has support at Rs 54,150-53,850, while resistance is at Rs 54,620-54,780. Silver has support at Rs 67,850-67,380, while resistance is at Rs 68,920–69,480, he added.
Global markets
Spot gold was little changed at $1,792.80 per ounce as of 0238 GMT. US gold futures rose 0.4% to $1,801.80.
Spot silver rose 0.3% to $23.63, platinum gained 0.3% to $980.01 and palladium rose 0.2% to $1,683.21.
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