Mumbai: Indian gold futures opened up on firm oil prices, but the market is expected to remain rangebound during the day’s trade due to a holiday in US, analysts said.
“Firm crude oil is the only supporting factor for the market,” said Harish Galipelli, head of research, Karvy Comtrade Ltd.
Oil prices rose more than $1 on Monday after energy firms in the US Gulf shut down nearly all offshore oil output and a host of flood-prone coastal refineries ahead of Hurricane Gustav, the biggest threat since 2005’s devastating Katrina.
Crude oil and gold move in tandem as the former signals inflation, while the latter is a hedge against rising prices.
However, volumes are expected to remain thin due to holiday in U.S., said Debjyoti Chatterjee, associate vice-president, MAPE ADMISI Commodity Research.
US markets are closed on Monday for Labor Day holiday.
“October contract on the MCX is expected to trade in the range of Rs11,850-11,950 levels,” he said.
Open interest for October gold on MCX was at 9,375 lots, up from 9,118 the previous session. Volume on Saturday was 1.6 kg.