Gold and silver fell on the last trading day of the week in New York, and on the Indian trading platforms of MCX and NCDEX on speculation that the precious-metals' rally will falter after prices failed to keep pace with crude oil and the euro.
Still, the bullion market is looking strongly positive on account of heavy buying from investment funds, betting on strong returns in the long term. The Euro touched record high against Dollar last week.
The IMF plans to sell 403 Metric Tones of Gold in international market to meet fund requirement that may not support price down side and the G-7 pledged to implement further monetary and fiscal policies to beat global inflation and likelyhood of a recession.
Expect gold to be likely bullish due to higher crude oil price. Expect infusiong of huge number of hedging funds in bullion market againt weaker dollar.
Technical Outlook
The short run technical indicators in bullion are like RSI is natural zone with 60 point which indicate not over bought and over sold position. The average in MACD are above the zero line, suggesting bullishness. The stochastic fast %K (29 ) is higher then %D (20) indicating positive sign for current price, the current price is higher than the 14 days moving average.
Supports are at $924,$912 and $896 and resistance are at $938,$952 and $970.
Rama Chandra Sahu is Senior Commodity Analyst, Voguestock Ltd, New Delhi
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