Gold, Silver to trade with bullish bias; pandemic worries, slower economic growth to aid prices
Mumbai-India (Dec 28) Commodity prices traded mixed during the week passed by with most of the commodities in Non-Agri segment witnesses selling pressure on stronger dollar and demand growth worries over pandemic fears. The dollar index ended up by 0.34 percent to 90.32 mark for the week. Gold prices traded lower for the week with spot gold prices at COMEX ended flat to $1883 per ounce. Gold prices at MCX ended down by 0.46% to Rs. 50073 per 10 grams for the week. The Gold ETF holdings remained unchanged as holdings at SPDR Gold Shares were at 1168 tonnes for the holiday-shortened week.
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Silver prices halted gains with spot silver prices at COMEX ended to $25.83 per ounce reporting minor gains. MCX Silver March futures ended over half a percent down to Rs. 67509 per KG on broad weakness in base metals for the week. Silver prices traded muted over mixed global cues with selling in industrial metals on lower demand concerns.
Bullion prices traded higher on Monday after US President Donald Trump signed the $2.3 trillion aid and spending package which he had refused to sign in previous week. The higher government spending means more pressure to dollar which also boosted buying in bullion prices. Bullion prices are expected to trade higher over pandemic worries and slower economic growth. The rising COIVD-19 cases across world and lockdown measures in UK, Europe and some parts of US may keep risk premium high in gold prices.
We expect bullion prices to trade in current range with bullish bias for short term with COMEX spot gold having strong resistance near $1920 per ounce and support at $1860 per ounce. At MCX, Gold February prices have near term resistance at Rs. 51200 per 10 grams and support at Rs. 49700 per 10 gram. COMEX silver spot has near term resistance at $27.50 per ounce with support at $25 per ounce. MCX Silver March has important resistance at Rs. 72000 per KG and support at Rs. 67000 per KG
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