The price of gold yesterday plunged 0.05% on the Multi Commodity Exchange (MCX). The December 2021 MCX gold futures contract closed at ??46,500 per 10 g, ??21 below its closing price on Thursday. The price of the yellow metal in September corrected about 4 percent while in August it fell about 2.1 percent on the MCX. According to commodities experts, the price of the yellow metal will continue to remain under pressure until it trades below $ 1,750 an ounce in the international market. However, they maintained that the bullion precious metal enjoys strong support at $ 1,680 and that any significant drop in the price of gold should be viewed as a buying opportunity for investors in the yellow metal.
Triggers for the price of gold
According to gold commodity experts, the price of gold may continue to remain under pressure on the strength of the US dollar. But, rising crude oil prices can cause global inflation to rise sharply. This rise in inflation could force the Fed to rethink its recent decision on bond tapering. Thus, the rise in the price of crude oil could lead to a reversal of the trend in the price of gold during the second half of October 2021. Apart from that, the rapid approach of festival season in India is expected to fuel demand for gold in the domestic market, which is also positive for the yellow metal. perspectives. They said the current energy crisis in China could also cause a sharp correction in stock markets, where equity investors could turn to gold investments.
Speaking on the outlook for gold prices; Anuj Gupta, vice president of commodities and currency trading at IIFL Securities, said, “The price of gold is under pressure until it is below $ 1,750 an ounce in international markets. . should be seen as a buying opportunity by investors. The current decline in the price of gold is due to the strengthening of the US dollar following the Fed’s announcement to cut bonds. However, the way the price of crude oil has skyrocketed in the international market; increase global inflation over the next few weeks, which could force the Fed to rethink its announcement. The fast approaching festival season in India is also creating a favorable environment for gold investors.
Echoing the views of Anuj Gupta; Amit Khare, AVP- Research Commodities at Ganganagar Commodity Limited, said, “The electricity crisis in China has put global stock markets under pressure. have a negative impact on the global economy, especially on the inflation front. “
Gold price target
As to whether there will be a trend reversal in the price of gold in October, Anuj Gupta of IFL Securities said, “During the first half of October, the price of gold on MCX could lower again until ??45,500 to ??45,000 per 10g, as the US dollar may continue to remain strong during this period. However, once it starts showing some weakness, the price of gold in the international market will break through the hurdle of $ 1,750 to $ 1,760 per ounce and hit the range of $ 1,800 to $ 1,850 per ounce. next month. In terms of MCX, the go0ld price can go up to ??48,000 to ??48,500 per 10g over the next month. “
In line with Anuj Gupta, Amit Khare of Ganganagar Commodity Limited said: ” ??45,000 to ??46,000 per 10g on MCX is a very good buying range for gold investors as it is around ??10,000 less than its all-time high. We can wait each other ??4,000 to ??5,000 per 10g increase from these levels in the price of gold over the next 3 months. Likewise, silver investors can expect ??10,000 per kg increase over the next 3 months from the current price of silver on MCX. “
Abhishek Chauhan, Head – Commodity & Currency at Swastika Investmart Ltd said: “We expect the price of gold to reach ??49,000 per 10g until coming Diwali, which is about a month away. “
Disclaimer: The opinions and recommendations expressed above are those of individual analysts or brokerage firms, not Mint.
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