Gold was trading higher on December 4, tracking a positive trend in international spot prices on a weak dollar and stimulus hopes.
On the Multi-Commodity Exchange (MCX), February gold contracts were trading higher by 0.17 percent at Rs 49,385 per 10 gram at 0920 hours. March silver was trading 0.3 percent higher at Rs 63,844 per kilogram.
A bipartisan, $908-billion coronavirus aid plan gained momentum in the US Congress on December 3 as conservative lawmakers expressed their support and Senate and House of Representatives leaders huddled, a Reuters report said.
Gold tends to benefit from stimulus measures as it raises the prospect of inflation which bullion is used to hedge against, it said.
Experts are of the view that the momentum remains strong and any dips will be a buying opportunity. The next resistance for the yellow metal is seen at Rs 49,550-49,770 levels.
Gold showed strength for the third straight day after a dismal performance in November. Gold and silver gained on December 1, ignoring better-than-expected US unemployment claims data.
Weakness in the dollar index supported prices of both the precious metals. Gold and silver settled on a positive note in the international markets.
The dollar index slide is supporting prices of precious metals. The index slipped below 90.70 marks on December 3 and set fresh 2-1/2 years lows.
“Renewed hopes of a second US stimulus is pushing the dollar index down. We expect both the precious metals to remain volatile in today’s session and further weakness in the dollar index could support prices of both the precious metals,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“Buy on dip strategy will work in both the precious metals. Gold has support at $1,828-1,814 per troy ounce and resistance at $1,858-1,870. Silver has support at $23.80-23.55 per troy ounce and resistance at $24.44-24.70,” he said.
On MCX, gold has support at Rs 49,100-48920 and resistance at Rs 49,550-49,770. Silver has support at 63100-62600 levels and resistance is placed at Rs 64,100-64,500 levels.
-Published on December 4th, 2020