Gold price today: Yellow metal under pressure; buy on dips for a target of 38,700

Gold futures fell in early trade on November 1 as investors booked profits after an over one percent rally seen on October 31.

Gold December futures were trading with a negative bias at Rs 38,456 per 10 gram at 10:18 hours IST. It had closed 1.29 percent higher at Rs 38,578 on October 31.

Experts feel the trend in gold is still intact and investors should use dips to buy for a near-term upside target of Rs 38,700-38,800/10 gm.

Gold and silver prices gained more than a percent on October 31 amid reports of cancellation of Chile’s APEC meeting raised concerns over the signing of a US-China trade deal.

The North Korean missile test and Chairman Jerome Powell’s comment that the US Federal Reserve won’t hike interest rates until inflation rises to significant levels supported buying in the yellow metal but put pressure on the Dollar index.

The Dollar index fell more than 0.50 percent and the US 10-year bond yield fell drastically. “Panic selling in the Dollar Index and lower bond yields attracted safe-haven buying in gold and silver again. Spot Gold crossed $1,500 and closed around $1,511 per troy ounce,” Manoj Kumar Jain, Director at IndiaNivesh Commodities, told Moneycontrol.

“We expect both the precious metals to remain firm and any dip in the prices will be the opportunity to buy again. Gold can be bought around Rs 38,400 levels with a stop loss of Rs 38,200 for a target of Rs 38,650-38,800/10 gm. Silver can be bought around Rs 46,500/kg with a stop loss of Rs 46,200 for a target of Rs 46,850-47,000,” he said.

Gold strategy:

Gold showed a sharp rise towards Rs 38,550/10 gm on October 31 and closed on a positive note. It formed a strong bullish candlestick pattern on the daily chart, which suggests positivity.

“A break above Rs 38,650/10 gm will indicate that the uptrend is continuing. But a failure to do so can keep prices in a range. Buy MCX Gold December in the range of Rs 38,480-38,420 with Rs 38,300 as stop loss and target of Rs 38,700,” Pritam Kumar Patnaik, Head Commodities, Reliance Commodities, said.

Courtesy: MoneyControl