IND: Gold Holds On With Modest Gains, COMEX Futures Around $1210
Gold futures on MCX are holding on with moderate gains in the first one-hour of trade though an initial upshot to Rs 18500 has been unable to materialize into a further jump for the counter. The global futures also drifted lower from nearly $1214 per ounce and currently linger at $1210.9, up $3.90 per ounce with all eyes on a break under $1210 levels.
Gold rose in Asia earlier in the day, rebounding after a mini collapse yesterday as the dollar tumbled to the lowest level in two month against the Euro and supported commodity prices. Gold has been back to the winning combination it had with the single currency in the current week and it seems that unless the Euro breaks lower on a conclusive basis, the risk appetite would continue to prevent the gold prices from falling lower.
Gold futures on the COMEX Division of the New York Mercantile Exchange retreated after paring earlier gains on Wednesday, as investors sold off gold to take profits after gold jumped the most in three weeks on Tuesday. The prices were not able to hold on above $1210 per ounce level in the floor trading as equities slipped and an overall moderation was seen in commodities. The most active gold contract for August delivery dipped 6.5 dollars, or 0.5 percent, to finish at 1,207 U.S. dollars per ounce.
The euro recovered lost ground against the U.S. dollar and again reached a 2-month high on Wednesday, as investors worried the U.S. economic recovery may be losing momentum. The currency hovered around the same level in the morning, supporting gold and pushing the COMEX futures to a high of $1213.80 per ounce. The counter currently trades at $1212.60, up $5.60 per ounce from the previous close.
Economic numbers from the US have been mostly glum off late and dollar might not be able to record sizeable gains in the near term. For today, the currency looks likely to gain somewhat but 1.2700 remains the key. COMEX Gold needs to hold up above $1210 yet again to witnesses more buying.
MCX Gold futures for August yet again failed to hold above Rs 18500 and closed at Rs 18383 per 10 grams, down Rs 65 from the previous close yesterday. The counter topped Rs 18485 per 10 grams today and currently trade at Rs 18443, up Rs 60 or 0.33% on the day. Watch out for Rs 18430 to act as a critical support level. Upsides could not be ruled out if this level holds.
