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| Gold seen ranged on stable global outlook |
| Dilip Kumar Jha / Mumbai Mar 22, 2009, 00:22 IST |
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Gold is likely to remain rangebound as markets around the world stabilise folllowing strong interventionary pledge taken by the global economic powers. Early last week, finance ministers of the G20 group gathered in Britain and decided to take strong steps to deal with the global slowdown.
With gold stabilising above $900 an ounce in the global markets and Rs 15,000 per 10 gm in the domestic market, the precious metal offers little room for major price variations. However, with the recent announcement by the Federal Reserve to buy up to $300 billion of long-term treasuries, the US currency was expected to become weaker.
In turn, this move would benefit gold, said an analyst with one of the leading precious metals research house. He, however, cautioned that the bullish trend in industrial commodities, especially base metals, might result in a further rise in gold prices.
Navin Mathur, head (commodities), Angel Broking, sees no major divergent move in precious metals next week.
Meanwhile, the World Gold Council (WGC) is preparing a major market initiative to attract retail consumers of the yellow metal ahead of Akshaya Tritiya (April 27), the second most auspicious occasion after Dhanteras for buying gold.
Since the market could not trade beyond the crucial resistance of Rs 15,660, a marginal correction can be expected at the Rs 15,310 level and then around the Rs 15,100 level.
But, in case the bull run in precious metals continues, the yellow metal may surpass the initial resistance at $1,000 an ounce and then move towards the historic level of $1,032. In rupee terms, this would translate into Rs 15,860 for the yelow metal. But, profit taking at this level may pull the prices down to $920 overseas and below Rs 16,000 in the domestic market.
Last week, gold opened at Rs 15,303 and fell sharply lower, breaking both its initial and strong support levels, but finally found a good support around Rs 14,640. Later, it recovered sharply and hit a high of Rs 15,581 and finally closed with a gain of Rs 191 at Rs 15,501.
Since silver failed to breach the crucial resistance at Rs 22,850 per kg last week, a correction can be expected towards its initial support at Rs 22,300 and then at Rs 21,900. Resistance is seen around Rs 22,850-22,950. Last week, silver prices opened at Rs 22,250, but fell sharply and later found a good support at Rs 20,435. It recovered sharply higher and touched a high of Rs 22,870, and finally closed the week with a gain of Rs 467 at Rs 22,737.
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