Gold weakens on profit-taking

Gold weakens on profit-taking
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First Published: Tue, Mar 03 2009. 12 13 PM IST
Updated: Tue, Mar 03 2009. 12 13 PM IST
Mumbai: Gold futures shed over 3% in early trades on Tuesday as investors resorted to profit-taking to benefit from the almost 4% gain in the previous three sessions, analysts said.
“We expect this profit-booking to continue in gold till 15,000 levels,” said Devarsh Vakil, manager-research, Anagram Capital in Ahmedabad, “we expect a reversal in equities which could prove negative for gold.”
Weakness in equity markets typically leads investors to gold, which is seen as a safe haven.
“Gold is strongly supported at Rs15,000,” said Vikas Vaid, an assistant vice-president with Asit C. Mehta Commodity Services, adding “gold’s movement would also be dependent on fluctuations in rupee.”
The rupee strengthened on Tuesday from the previous day’s record low, making the largely imported yellow metal cheaper in local markets.
The benchmark April contract was 2.59% lower at Rs15,397 per 10 grams at 11:44am, after hitting a low of Rs15,305 earlier.
“Dips should be used as an opportunity to go long in gold with a long-term perspective,” Vaid added.
Open interest for April gold on MCX was at 19,207 lots, down from 17,636 a day earlier. Volume on Monday was 75.45 kg.
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First Published: Tue, Mar 03 2009. 12 13 PM IST
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