NEW DELHI: Gold kicked off the new week on a negative note. The yellow metal plunged over a per cent during the early trade on Monday in the domestic market, following global footsteps.
The stronger-than-expected US job market report have dampened the sentiments for bullion. The dollar index rallied which affected the demand for precious metals.
Gold futures on MCX were down 1.36 per cent, or Rs 636, at Rs 46,004 per 10 gram. Silver futures tanked 1.92 per cent, or Rs 1,2,48, lower at Rs 63,752 per kg.
“The yellow metal extended decline following the sell-off on Friday after a stronger than expected US job market report. The improved job numbers raised market expectations of sooner Fed tapering despite a cautious approach,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
According to Reuters, India’s physical gold market flipped into a small premium last week for the first time in a month as prices eased although activity was still subdued.
In the spot market, highest purity gold was sold at Rs 47,647 per 10 gram, while silver was priced at Rs 66,727 per kg on Friday, according to the Indian Bullion and Jewellers Association.
Gold and silver continued to struggle in the Indian market today. The yellow metal is trading at its lowest level in the last one month, whereas silver has declined over Rs 2,000 during the period.
The fifth tranche of sovereign gold bonds (SGB) scheme 2021-22 will open on Monday, with the issue price set at Rs 4,790 per gram of gold. A discount of Rs 50 per gram will be given to those who are applying online.
Trading strategy
“We expect gold prices to trade weak for the day with COMEX Spot gold support at $1,670 and resistance at $1,750 per ounce. MCX Gold October support lies at Rs 45,500 and resistance at Rs 46,500 per 10 gram,” added Patel of HDFC Securities.
Global markets
Spot gold fell 2.3% to $1,722.06 per ounce by 0048 GMT. Earlier in the session, prices touched $1,684.37, their lowest since March 31. US gold futures slipped 2.1% to $1,726.40.
Silver slumped as much as 7.5% hitting a more than eight-month low of $22.50 per ounce earlier in the session. It was last down 2.6% at $23.70. Platinum fell 1.5% to $965.50, having earlier hit a low since November 2020 of $959.93. Palladium rose 0.2% to $2,633.35.