Experts say investors could use the dips to buy into the gold as the momentum could take the precious metal to retest Rs 41,000 level.
India’s gold prices for April delivery rallied on February 18, tracking gains in the international spot prices that hit a two-week high as global equities retreated after Apple Inc flagged a revenue miss amid the coronavirus outbreak, sobering investor optimism.
Spot gold rose around $1,586.19 per ounce. Earlier in the session, bullion prices touched their highest since February 3 at $1,586.90, said a Reuters report.
The death toll from the coronavirus outbreak in mainland China rose to 1,868, as of February 17, up by 98 from the previous day, it said.
The April gold contracts rose 0.54 percent, or Rs 220, to Rs 40,976 per 10 gram on the Multi Commodity Exchange (MCX) at 0920 hours.
Experts are of the view that investors could use the dips to buy into gold as the momentum could take the precious metal to retest Rs 41,000.
International gold held on to the support of $1,574 and for silver, it stayed above $17.70 per troy ounce.
At MCX, gold slipped below Rs 40,800 but silver held 46,000 levels.
“We expect both the precious metals to remain volatile and lower level buying is expected around $1,574 and $17.55 per troy ounce levels,” Manoj Jain, Director, India Nivesh Commodities, told Moneycontrol.
“At MCX, buying is expected in gold around 40,500 and again it could test 40,850-41,000 levels, 40330 act as a major support for gold. Even in silver, buying expected around 45,850 levels, it could test 46,200-46,500 levels, 45,500 act as major support for silver,” he said.
Trading Strategy:
Expert: Sriram Iyer, Senior Research Analyst, Reliance Commodities
MCX Gold April contract has taken a resistance of Upper Band of Triangle formation which suggests some downside momentum.
This has made bearish candlestick on the daily chart, which suggests sideways to negative action can continue. LBMA gold spot has been intact in the range of $1,570 and $1,593 and a fresh breakout is awaited.
Hareesh V, Head of Commodity at Geojit Financial Services.
Gold may edge higher further on hints that the coronavirus outbreak in China has negatively impacted global businesses and the economy. Risk averse investors continue to invest in gold due to its safe haven appeal. Meanwhile, gains may be limited owing to a strong U.S dollar and moderate physical market activities.Technical outlook: As long as prices stay above $1560 expect upticks to continue towards $1592 initially followed by $1610. Weakness is expected only on a close below $1545.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Exclusive offer: Use code "BUDGET2020" and get Moneycontrol Pro's Subscription for as little as Rs 333/- for the first year.
