Daily gold price (January 26): Short-term outlook, forecast and updates
Yellow metal holds above Rs 49,100, experts say buy on dips
Experts are of the view that investors can buy any dip towards Rs 49,000 for a target of Rs 49,400 per 10 gm. Gold came under pressure due to recovery in the dollar but stimulus hopes kept the sentiment alive, Moneycontrol reported.
Gold prices fell in Indian markets on January 25, tracking a muted trend in international spot prices. On the Multi-Commodity Exchange (MCX), February gold contracts were trading lower by 0.04 percent at Rs 49,119 for 10 grams at 0920 hours. March silver was trading 0.34 percent lower at Rs 66,871 a kilogram.
Experts are of the view that investors can buy any dip towards Rs 49,000 for a target of Rs 49,400 per 10 gm. Gold came under pressure due to recovery in the dollar but stimulus hopes will keep the sentiment alive.
Gold and silver prices settled on a weaker note in the international markets on January 22. February gold futures contracts settled at $1,855.30 per troy ounce and March silver at $25.55 per troy ounce.
Domestic markets ended weaker on January 22. Gold and silver prices slipped amid better-than-expected US flash manufacturing and services PMI data and rollout of the COVID-19 vaccine.
“Gold and silver prices reacted negatively after upbeat data but got support at lower levels amid hope of further US stimulus and weakness in the dollar index. We expect both the precious metals to remain volatile this week and expect to get support at lower levels,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“At MCX, gold has a support at 48,920-48,700 and resistance at 49,330-49,600; silver has support at 66,000-65,500 and resistance at 67,200-68,000 levels,” he said.
Jain said buying in gold on dips around 48,800 with the stop loss of 48,550 for the target of 49,400 and buy silver on the dips around 65,800 with the stop loss of 65,000 for the targets of 67,200.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities
Comex gold trades marginally lower near $1,854/oz after a 0.5 percent decline in the previous session. Gold is pressurised by a recovery in the US dollar index from recent lows, continuing ETF outflows, and lack of cues from major central banks.
However, supporting price is hopes of additional US stimulus, rising virus cases, mixed economic data from major economies and US-China tensions.
Gold may remain choppy unless there are fresh triggers but general bias may be on the upside on the stimulus expectations.
Sriram Iyer, Senior Research Analyst at Reliance Securities
International gold prices gave up gains and ended down close to 1 percent, while silver slipped over 2 percent on January 22.
Domestic gold and silver ended lower, tracking overseas prices. The dollar drifted higher after three straight days of losses and riskier currencies fell after bleak non-US economic data pushed investors towards the safe-haven appeal of the greenback.
Domestic bullion could trade flat on January 25, tracking international prices.
Technically, MCX April gold has bounced back from 48,900 levels and reversed above 49,300, indicating a bullish momentum up to 49,500-49,760 levels. Support is at 49,150-48,900 levels.
MCX March silver bounced back from 66,500, above which it will continue its bullish to 67,700-69,200. Support is at 65,800-64,700 levels.
Check gold rates in Delhi, Kolkata, Chennai and Mumbai
The price of gold has witnessed a marginal decline on the first day of the week that is Monday, January 25, whereas the rate of silver remained the same in the market. The amount one will have to pay for purchasing one gram of 22-carat gold is Rs 4,832 after decreasing by Re 1, according to the rates collected from Good Returns. Similarly, with a reduction of Rs 10, the price of 10 grams of 22-carat-gold stands at Rs 48,320, according to News18.
Following the same trend, the rates of 24-carat gold are on the decline as well. For 10 grams, the price is Rs 49,320 after a fall of Rs 10. There is a difference of Rs 1,000 on comparing the prices of 22- carat gold of 10 grams from that of 24-carat of 10 grams.
Delhi: In the national capital, the price of 22-carat gold stands at Rs 48,080 per 10 grams, whereas for buying 10 grams of 24-carat gold, you will need Rs 52,450.
Chennai: For 22-carat gold, you will have to pay Rs 46,530 per 10 grams, while 24-carat gold comes at Rs 50,780. The city is comparatively less expensive for purchasing gold than the national capital.
Kolkata: You will need more money for buying 22-carat gold in the city as it is costlier than that of in Delhi and Chennai. The cost of 22-carat gold is Rs 48,650, while for 24-carat gold, the rate is Rs 51,350.
Mumbai: The price of 22-carat gold in Mumbai is Rs 48,320, while you will have to pay Rs 49,320 for 24-carat gold.
Price of Gold Fundamental Daily Forecast – Short-Term Bullish Speculators Still Waiting for a Catalyst
At this time, there is no clear bullish catalyst for gold so a rally may have a hard time gaining traction, said Fxempire.
Gold futures finished lower on Friday, easing from a two-week high reached the previous session as some investors booked profits ahead of the week and on the strength of the U.S. Dollar against a basket of major currencies.
Losses may have been limited by the hopes that fresh stimulus could be coming from the Biden Administration although there could be problems with the timing of the coronavirus relief and the size of the package.
On Friday, April Comex gold settled at $1856.20, down $13.10 or -0.70%.
Better-than-expected U.S. economic data may have also capped gains since it pointed toward an improving economy although jobless data on Thursday indicated that a weakening labor market could continue to be a drag on the economy.
Gold traders are also watching rising coronavirus cases in China and the Euro Zone. China could single-handedly pressure the global economy, which would increase the need for more fiscal and monetary stimulus worldwide. The Euro Zone is probably headed into another recession, which could weigh on the Euro, thereby boosting the U.S. Dollar Index.
Biggest Influence on Gold Will be Direction of Treasury Yields
The 10-year Treasury yield dipped on Friday morning, as President Joe Biden’s proposed $1.9 trillion stimulus package faces opposition in Congress just a week after he announced the plan.
The yield on the benchmark 10-year Treasury note fell to 1.086%, while the yield on the 30-year Treasury bond dipped to 1.847%.
The drop in Treasury yields came as moderate Republican senators critiqued Biden’s plan, while another Democrat lawmaker said he would oppose another coronavirus relief check to Americans.
Here’s the tricky part that could confuse gold traders.
If Biden’s gets his $1.9 trillion stimulus package, in other words, everything he is asking for, then inflation could go up. If inflation goes up then Treasury yields will move higher, helping to support the U.S. Dollar. A stronger dollar will then drive down foreign demand for dollar-denominated gold.
If the Biden plan struggles in Congress and a smaller package is passed then stocks could pull back, which means demand for risky assets would fall. This would also send investors into the safety of the U.S. Dollar, and once again, gold prices could be capped.
At this time, there is no clear bullish catalyst for gold so a rally may have a hard time gaining traction. The long-term fundamentals are bullish enough to provide support, but a runaway rally like we had last year from April to August is just not in the cards right now.
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