Gold prices moderately fell by Rs 17 to Rs 48,017 per 10 gram in the Mumbai retail market on strong equity, firm rupee and lacklustre global trend. The yellow metal has been stuck in range as market participants await the US job number later this week.
The price of 10 gram, 22-carat gold in Mumbai was Rs 43,984 plus 3 percent GST, while 24-carat 10 gram stood at Rs 48,017 plus GST. The 18-carat gold is quoted at Rs 36,013 plus GST in the retail market.
However, the bullion prices were supported by rising coronavirus cases globally and concerns about the health of the Chinese economy.
Speculation remains around the timing of when the Federal Reserve will lay out a timetable for tapering its program of monthly asset purchases.
The US dollar traded lower at 91.91, down 0.16 percent against a basket of six rival currencies.
Gold holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund fell by 1.8 tonnes to 1,029.71 tonnes. The ETF has a market value of $59.94 billion.
Spot gold decreased by $3.46 to $1,810.24 an ounce at 1203 GMT in London trading.
MCX Bulldesk declined by 46 points or 0.31 percent, at 14,610 at 17:34. The index tracks the real-time performance of MCX Gold and MCX Silver futures.
“Gold prices traded weak despite dollar weakness as market players are eyeing US job market report this week. The job market report will indicate the upcoming FED stance on a taping of asset purchase. Gold ETF holdings at SPDR gold shares fell to 1029.71 tonnes from previous week’s 1031 tonnes”, said Tapan Patel- Senior Analyst (Commodities), HDFC securities.
Patel expects gold prices to trade sideways to up with COMEX spot gold resistance at $1820 and support at $1795 per ounce. MCX Gold October support lies at Rs 47,600 and resistance at Rs 48,000 per 10 gram.
The gold/silver ratio currently stands at 70.87 to 1, which means 70.87 ounces of silver is required to buy an ounce of gold.
Silver prices slumped by Rs 154 to Rs 67,752 per kg against its closing price on August 2.
In the futures market, the gold rate touched an intraday high of Rs 47,972 and an intraday low of Rs 47,825 on the Multi-Commodity Exchange (MCX). For the October series, the yellow metal touched a low of Rs 46,650 and a high of Rs 50,040.
Gold futures for October delivery dropped Rs 191, or 0.40 percent, to Rs 47,895 per 10 gram in evening trade on a business turnover of 12,616 lots. The same for December slipped Rs 157, or 0.33 percent, to Rs 48,096 on a business turnover of 677 lots.
The value of October and December’s contracts traded so far is Rs 1,315.53 crore and Rs 25.01 crore, respectively.
Similarly, Gold Mini contract for September edged lower by Rs 184, or 0.38 percent at Rs 47,830 on a business turnover of 13,055 lots.
Trading Strategy
Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited
Technically, international Gold is trading with a bearish bias below $1,820. Prices tested the resistance of $1,827-1,833 levels in the previous week and sustained below. On the domestic front, MCX October gold is trading with negative bias. In the previous session, prices held over Rs 47,800 and gained more than 300 points from there. If the market breaches this level with sufficient volume, we can expect a price decrease to Rs 47,650-47,580 levels.
Geojit Financial Services
Major weakness may establish only by sustainable trades below Rs 47,600 region. Which if remain untouched could expect prices to find momentum towards the recent highs.
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