Mr. Anuj Gupta - DVP - Commodities and Currencies Research, Angel Broking Ltd
As expected yesterday gold and silver prices corrected sharply. Gold prices corrected by 1.73% and closed at 49,508 levels. Silver prices corrected 4.45% and closed at 58,488 levels.
Sharp recovery in Dollar index cause of correction in Gold and Silver. Spot gold ended lower 1.9 percent to close at $1863.5 per ounce as strengthening of the U.S. Dollar and no signs of further stimulus infusion by the U.S. policy pressurized Gold prices. Spot gold is trading at $1856 per ounce and silver is trading at $ 22.15 per ounce.
U.S. Federal Reserve Vice Chair Richard Clarida said on Wednesday that the U.S. economy remains in a "deep hole" and not going to increase interest rates until inflation hits 2%. The main cause of concern for the US economy is joblessness and weak demand. Worries of reinforcement of lockdown in the Eurozone reflecting the alarming increase in Covid-19 cases dampened hopes of economic recovery limiting the fall in Gold prices.
As for today traders can go for sell in gold at Rs 49,500 levels with the stop loss of Rs 49,950 levels for the target of 48,700 levels. They can also go for sell in Silver at Rs 57,500 levels, with the stop loss of 58,700 levels and for the target of 56,000 levels.