BackGold prices today fall for 3rd time in 4 days, silver struggles after big drop
The overall trend for gold remains positive but in near term there could be choppiness, say analystsGold is seen as a hedge against currency depreciation and inflation
PremiumGold and silver prices struggled in Indian markets today. December gold futures on MCX were down 0.06% to ₹50,305 per 10 gram. Silver futures edged 0.25% higher to ₹60,055 per kg. In the previous session, gold had declined 0.6% while silver plunged 4% or ₹2,500. After correcting from August 7 highs of ₹56,200, gold prices have remained choppy in recent days. Silver prices have also fallen significantly from their highs of about ₹80,000 hit in August.
MCX gold has support at ₹49200 and resistance at ₹51,120, says Geojit Financial Services.
In global markets, gold prices were little changed today, supported by a softer US dollar and hopes of another coronavirus relief package announcement in the US. On the other hand, global risk sentiment improved after upbeat US private payrolls data. Spot gold was steady at $1,884.67 per ounce.
"As long as gold prices stay above $1840 expect recovery upticks to continue the day as well. However, it required to break $1900 to trigger major rallies in the counter. An unexpected drop below $1840 is a signal of weakness," says Geojit Financial Services in a note.
Hopes are rising that US lawmakers could finally hammer out a new virus rescue package for the world's top economy after months of deadlock. House Speaker Nancy Pelosi and Treasury Secretary Mnuchin have held a series of talks this week aimed at breaking the impasse and both have said they were "hopeful".
Among other precious metals, silver rose 0.2% to $23.25 per ounce, platinum was up 0.4% to $891.95 and palladium edged 0.2% higher to $2,309.07.
"Gold trades near the key $1900/ounce level and while overall trend looks positive we may see choppiness as there are many uncertain factors like US stimulus plan, EU-UK Brexit negotiations and economic readings from major economies," Kotak Securities said in a note.
Silver has rebounded from its recent lows. The white metal has benefitted from improved outlook for industrial demand amid pick up in industrial activity in China and globally, the brokerage said.
In Indian markets, gold had fallen below ₹49,500 earlier this week but has taken support from lower levels as the US dollar index continued to retreat from recent highs. The US dollar has turned softer as market focus shifted to US economy amid first US presidential debate, efforts to reach consensus on new fiscal stimulus and some important economic indicators, analysts say.
Gold is seen as a hedge against inflation and currency depreciation. Despite the recent price correction, gold has gained 24% so far this year, supported by monetary stimulus from major central banks and governments.
Asian markets were mostly higher today after latest data showed US private employers stepped up hiring in September. (With Agency Inputs)
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