COMEX Gold continued to face critical resistances around $1400 per ounce and slipped lower on profit selling as the watershed level approached today. The commodity witnessed a strong bounceback in Asia today after a sharp drop from record peaks in the last session. The strong spell of risk appetite in the world market pulled gold lower from levels near $1400 per ounce yesterday and a quick sell off was witnessed in New York last night.
The Purchasing Managers Index (PMI) of China's manufacturing sector rose to 55.2% in November, up 0.5 percentage points from October, according to the Federation of Logistics and Purchasing. The figure marked an increase for the fourth consecutive month and the 21st straight month that the index was above 50%, connoting economic expansion. The other manufacturing reports from Eurozone and US were aslo supportive for risk appetite and the equity markets edged up sharply in the US.
This momentum continued in Asia today and the benchmark stock markets logged impressive gains. Gold still rose, finding decent buying support as the US dollar continued to drift lower ahead of the European Central Bank's interest rate decision. The greenback tested lows above 1.3200 against the Euro and pulled up the benchmark COMEX Gold futures to $1396 per ounce before the momentum waned.
COMEX Gold currently quotes at $1391.20 per ounce for the February futures, up $2.90 per ounce from the previous close. MCX Gold futures for February edged up above Rs. 20700 and slipped lower to trade at Rs. 20636, up Rs. 14 or 0.07% on the day. Prices could drop severely once Rs. 20600 gives up.
