From an all-time high of Rs 56,191, gold prices have climbed off Rs 6,236, breaching the Rs 50,000-mark on the downside for the first time in 22 days.
Extending the losses from the previous sessions, gold prices fell nearly Rs 2,000 per 10 grams on Wednesday. From an all-time high of Rs 56,191, gold prices have climbed off Rs 6,236, breaching the Rs 50,000-mark on the downside. Gold prices were seen below Rs 50,000 last time on July 21. With today’s crash in the prices, it is the third consecutive fall today, mirroring the plunge in international rates. Similarly, silver prices too crashed for the third session on the trot, falling over Rs 6,000 per kg in just one day. From a record high of Rs 77,949 per kg, silver prices have plummeted Rs 17,039 per kg in the domestic market. “Gold futures opened with a gap down on MCX trading below 50000 levels down nearby 4% tracking weakness from International gold prices which had posted their largest one-day percentage loss in nearly five months as investors focused attention on a rally in US Treasury yields and a climb in the equities toward its all-time closing high,” said Ajay Kedia, Kedia Advisory, Mumbai.
At 10.30 AM, gold October futures were trading Rs 1,395 or 2.69 per cent down at Rs 50,534 per 10 grams, while silver September futures were ruling at Rs 62,460 per kg, down Rs 4,474 or 6.68 per cent. Analysts say better than expected economic data from the US and hopes of stimulus lifted the sentiments in the equities, which weighed down gold prices. “The dollar has also rebounded and investors are running to book profits. Today will be a volatile session with a downward bias,” said Jigar Trivedi, Fundamental Research Analyst, Anand Rathi Shares and Stock Brokers.
As Russia announced to become the first nation to approve the COVID-19 vaccine, profit booking was witnessed in the yellow metal. Gold prices have corrected 10.61 per cent in the last four days from a life-time high of Rs 56,191 to Rs 50,106 per 10 grams. “Development of the vaccine of COVID-19, hawkish data from the US economy and recovery in dollar put pressure on gold. In the international market gold also corrected 9.32% from a life-time high of $2075 to $1872 levels. We expect more profit booking in gold and it may expect to test 49000 levels while in the international market it may test $1850 levels soon,” said Anuj Gupta, DVP- Commodities and Currencies Research at Angel Broking.
More pressure in bullion complex on margin calls can be seen. Ajay Kedia also said that traders will look for an excuse to lock-in profits with their bullish gold bets jumped all over Russia’s vaccine news. “Technically now gold price continues to decline strongly to lose recent gains and settles below 51100. It will be facing more negative pressure that might push the prices down. But we notice that the price trades at the main bullish channel’s support line, which might push trades to start recovery attempts,” Kedia said.
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