Technically Gold market is under short covering as market has witnessed drop in open interest by 0.31% to settled at 8723 while prices up 139 rupees.
Now MCX Gold is getting support at 48174 and below same could see a test of 48044 levels, and resistance is now likely to be seen at 48391, a move above could see prices testing 48478.
Gold yesterday settled up by 0.29% at 48303 as the market focus pivoted to this week’s Federal Reserve meeting to learn how quickly it plans to unwind economic support measures introduced in response to the coronavirus pandemic.
Data showed U.S. consumer prices rose further in November, leading to the largest annual gain since 1982. Although gold is considered an inflation hedge, reduced stimulus and interest rate increases tend to push government bond yields up, raising the opportunity cost of bullion, which pays no interest.
U.S. jobless claims dropped to their lowest level in more than 52 years last week as labour market conditions continued to tighten amid an acute shortage of workers.
Top Asian hubs saw healthy demand for physical gold as domestic prices retreated into the year-end, although volatility in rates deterred retail buyers and jewellers in India.
Customers in top consumer China were charged premiums of $7-$10 an ounce versus last week’s $6-$9. Hong Kong premiums rose to $0.80-$1.80 from $0.50-$1 previously.
The Indian market flipped to a discount of about $2 an ounce over official domestic prices from last week’s $2 premiums. The volatility has prompted jewellers to delay purchases for the upcoming wedding season.
Trading Ideas:
–Gold trading range for the day is 48044-48478.
–Gold steadied as the market focus pivoted to this week’s Federal Reserve meeting to learn how quickly it plans to unwind economic support measures.
–U.S. jobless claims dropped to their lowest level in more than 52 years last week as labour market conditions continued to tighten.
–India gold imports to remain high as mining, recycling low, says WGC.
Courtesy: Kedia Commodities
Source: Comodity Online