NEW DELHI: Gold eked out decent gains in India on Friday, following global trends. The yellow metal saw buying on the back of a weaker dollar. Investors are waiting for the US jobs data to gauge the Federal Reserve’s plans to start tapering asset purchases.
Gold futures on MCX were higher 0.25 per cent, or Rs 118, at Rs 47,109 per 10 gram. Silver futures, too, gained 0.17 per cent, or Rs 105, at Rs 63,390 per kg.
Gold prices are trading in a narrow range this week ahead of key US employment data. The US non-farm payroll data will be released today evening which may shake global markets causing some volatility.
The dollar index fell to a one-month low, bolstering gold’s appeal to those holding other currencies. Gold is considered a hedge against inflation.
Ravindra Rao, CMT, EPAT, VP-Head Commodity Research at Kotak Securities, said gold is supported by a weaker US dollar and safe haven buying amid mixed economic data, slowdown in China, persisting virus risks and rising inflationary pressure.
“However, weighing on price is weaker investor interest as is evident from continuing ETF outflows. Firmness in equities has also reduced gold’s appeal as an alternative asset. Gold may remain choppy amid Fed uncertainty but increasing risks to global economic recovery may keep prices supported,” he added.
Physical gold demand in India has remained subdued recently as jewellers held off purchases, hoping for a dip in prices.
In the spot market, highest purity gold was sold at Rs 47,274 per 10 gram while silver was priced at Rs 63,592 per kg on Tuesday, according to the Indian Bullion and Jewellers Association.
The spot price of the yellow metal has remained flat in the last two weeks, whereas silver has gained more than Rs 1,100 during the period under review.
Trading strategy
“We expect gold prices to trade sideways to up for the day with COMEX Spot gold support at $1,795 and resistance at $1,833 per ounce. MCX Gold October support lies at Rs 46,800 and resistance at Rs 47,400 per 10 gram” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Global markets
Spot gold rose 0.1% to $1,811.79 per ounce by 0115 GMT, but was headed for its first weekly decline in four. US gold futures gained 0.2% to $1,814.80.
Silver rose 0.2% to $23.92 per ounce, while platinum inched 0.1% higher to $1,000.04. Palladium climbed 0.3% to $2,408.18.