Daily gold price (January 23): Forecast and updates
Gold prices fall for 2nd day, down ₹7000 from record highs, silver drops
Gold and silver prices slid today in Indian markets amid weak global cues. On MCX, gold futures dipped 0.11% to ₹49,394 per 10 gram while silver dropped 0.71% to ₹66,821 per kg. In the previous session, gold had dipped 0.18% while silver edged up 0.5%. MCX gold has support at ₹47400 and resistance at ₹50,680, Geojit Financial Services said in a note, according to Livemint.
In global markets, gold prices edged lower as US Treasury yields inched higher but the precious metal still remained on course for a nearly 2% weekly gain. Spot gold today fell 0.3% to $1,863.56 per ounce. Among other precious metals, silver shed 1.1% to $25.67 an ounce while platinum fell 1.2% to $1,113.40.
Benchmark 10-year U.S. Treasury yields held firm above 1%, while the US dollar slightly lower against a basket of six currencies. Higher yields increase the opportunity cost of holding non-yielding bullion.
"A weak U.S dollar continues to offer support to the yellow metal. Likewise, hopes of fresh economic stimulus measures from the US and fears of a second wave of virus infection also continues to lift the demand of the commodity. Meanwhile, an improved global growth outlook would restrict major rallies in the counter," says Hareesh V, Research Head Commodities at Geojit Financial Services.
If the support of $1800 remains undisturbed, he added, "We can expect a recovery pullback in prices. However, it needs to break $1885 to stabilize the momentum. The immediate downside turnaround point is seen at $1770."
Asian equity markets were mostly lower today as restrictions to curb escalating coronavirus infections dented some of the optimism around earnings and the prospect of additional stimulus.
European Central Bank President Christine Lagarde on Thursday warned the virus continues to pose a serious risk after policy makers voted to keep pumping unprecedented amounts of stimulus into the economy.
Though gold is seen as a hedge against inflation and currency debasement, which can be caused by the massive stimulus measures, analysts say that it remains to be seen whether the stimulus proposed by US President Joe Biden would go through both houses of Congress as quickly as Biden's expectations.
A large part of gold's recent upmove is on "back of expectations of higher US stimulus and unless we get more clarity on stimulus front some caution is recommended," Kotak Securities said in a note.
Check Rates in Delhi, Kolkata, Chennai and Mumbai
The prices of gold vary in different cities of India depending on the carats on a daily basis following the national trend.
Delhi: In the national capital, the price of 22-carat gold is Rs 48,410 per 10 grams. Whereas for buying 10 grams of 24-carat gold, you will have to pay Rs 52,810.
Chennai: For 22-carat gold, you will have to pay Rs 46,920 per 10 grams, while for 24-carat gold, the amount isRs 51,190. Compared to the national capital, the prices in the city are less costly.
Kolkata: The price of 22- carat gold in the city is costlier than that in Delhi and Chennai. 10 gram of22-carat gold costs Rs 48,440 while for 24-carat gold, the price is Rs 51,070.
Mumbai: The rate of 22-carat gold in Mumbai is Rs 48,610, while you will have to pay Rs 49,610 for 24-carat gold.
If you are planning to buy any silver jewellery, then you will have to pay Rs 674 per 10 grams as there has been a decline of Rs 3 in its prices.
Silver prices in Metro Cities
The cost of one kilogram of the metal remained the same in Delhi, Mumbai and Kolkata at Rs 67,400. However, in Chennai and Hyderabad, the rate of one kilogram of the metal is a bit costly at Rs 72,400.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities
Comex gold was trading unchanged near $1,866/oz after a near flat close the previous day. Gold steadied on January 22 amid a pause in the US dollar’s recent decline. Also weighing on the price is the upbeat US economic data and lack of any clear cues from ECB or Bank of Japan, while ETF investors remained on the sidelines.
However, supporting price is increased US stimulus expectations, US-China tensions and rising virus cases.
Gold may witness choppy trade unless there are fresh triggers but the general bias may be on the upside, as US stimulus expectations may keep the pressure on the dollar.
Sriram Iyer, Senior Research Analyst at Reliance Securities
International gold prices eased from a two-week high on January 21 as investors booked some profit following a rally in the previous session, while expectations for further stimulus and a weaker dollar capped downside.
Domestic gold ended lower, tracking overseas prices, while silver rose on international prices.
Prices also came under some pressure after the number of Americans filing new applications for unemployment benefits decreased modestly last week.
Domestic bullion could trade flat to lower on January 22 morning, tracking international prices.
Technically, MCX February gold holds a resistance of 65-Daily Moving Average at 49900 levels below which could see downside 49,300-49,000 levels. Resistance is at 49,700-49,900 levels.
MCX March silver holds a resistance zone at 67,400-67,700, where prices could retreat and can trade on bearish note up to 66,500-65,800.
Hareesh V, Research Head Commodities at Geojit Financial Services
A weak dollar continues to support the yellow metal. Likewise, hopes of fresh economic stimulus measures from the US and fears of a second wave of infection continues to lift the demand for the commodity.
An improved global growth outlook would restrict major rallies in the counter.
If the support of $1,800 remains undisturbed, we can expect a recovery pullback in prices, however, it needs to break $1,885 to stabilise the momentum. The immediate downside turnaround point is seen at $1,770.
Gold Price Futures (GC) Technical Analysis – $1787.30 to $1711.70 is Still the Best Value Zone Target
Gold futures posted a choppy, two-sided trade before moving slightly higher late in the session on Thursday. After an early surge, gold prices eased from a two-week high as investors booked some profit following an upside spike the previous session. Meanwhile, expectations for further stimulus and a weaker U.S. Dollar helped limit losses.
Bullish traders are betting on President Joe Biden’s $1.9 trillion dollar coronavirus stimulus package to move smoothly through Congress. They are also hoping it will trigger a resumption of the downtrend in the U.S. Dollar and increased demand for dollar-denominated gold.
Bearish traders aren’t confident in the stimulus package moving quickly through the divided Congress. Furthermore, increasing demand for riskier assets could keep a lid on prices. Rising Treasury yields could also limit any gains in gold. Yields could go up since the Treasury will have to sell more bonds to pay for the stimulus package. In order to get the money it needs, the Treasury will have to offer higher rates.
Traders are still waiting for a catalyst to move this market in a big way in either direction.
A break into the major support zone at $1787.30 to $1711.70 is likely to draw the attention of longer-term buyers.
However, we really can’t think about a bullish move until the pattern of lower tops is broken with conviction. The last lower top comes in at $1966.80.
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