Gold rose the most in a week on concern that U.S. government plans to revive credit markets and ease the recession will stoke inflation, boosting the appeal of the metal as a hedge. The government may spend as much as USD 1 trillion to rescue banks. The Senate passed an USD 838 billion stimulus bill, moving it toward final congressional action. Investment in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, reached a record 881.9 metric tons yesterday. Gold /Silver ratio can be seen at 69.59, said Ajay Kedia, managing director, Kedia Commodities.
Currently, MCX Gold April delivery contract is trading up 0.17% at Rs 14,246 per 10 gram. It touched the high of Rs 14,270 and low of Rs 14,235 after opening at Rs 14,240 per 10 gram. The support for the gold MCX is seen at Rs 13,799 and below could see a test of Rs 13,671. Resistance is now likely to be seen at Rs 14,182, a move above could see prices testing Rs 14,437.
He recommended to take long position in gold at Rs 14,100-14,130, with stop loss of Rs 14,040 and target of Rs14,156-14,180-14,200-14,238. Bailout plan has made not much impact, he added.
