After rallying to a five-month high in the previous session, gold was trading steadily in the morning hours on November 16, as concerns over evolving inflationary risks kept its appeal despite a stronger US dollar and elevated bond yields. Gold contracts showed an uptick of 0.25 percent to reach Rs 49,422 for 10 grams at 9:37 am on the Multi-Commodity Exchange (MCX). Coming to the other precious metal, the silver futures rose 0.63 percent to Rs 66,984 a kg.
Abhishek Chauhan, Head of Commodity & Currency at Swastika Investmart, asserted that the prices of these metals are overbought, and they will go for a correction in the evening session, reported Money Control.
On MCX, gold and silver have not been able to hold on to above Rs 49,400 and Rs 67,400, respectively. Chauhan said gold is likely to go back to Rs 48,900 and silver Rs 65,500.
Even as the gold continues to trade near the June highs, several factors are stalling its momentum. The US Federal Reserve is expected to raise rates to keep a check on inflation which will impact gold’s price in the short term.
The Diwali festival had helped gold and silver to reach a five-month high-figure, but various economic factors could have an impact soon.
While not much volatility would be there amid a higher US dollar and bond yields, the mixed factors could mean fresh buying should be at dips since central banks are finally thinking of hiking rates.
Prithvi Finmart Commodity Research’s Manoj Kumar Jain told Money Control that both gold and silver are currently weak in the international markets, and expected the prices to remain stable, adding any decline now will be a buying opportunity. For gold, they suggested dips buying at Rs 49,100 with a stop loss of Rs 48,850 for target of Rs 49,600.
For silver, the dips buying starts at Rs 66,100 with a stop loss of Rs 65,000 for a target of Rs 67,200
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