Vaccine hopes likely to push gold below Rs 49k
New Delhi: Gold prices plunged by Rs 1,049 to Rs 48,569 per 10 gram in the national capital on Tuesday following weak global cues and rupee appreciation, according to HDFC Securities. In the previous trade, the precious metal had closed at Rs 49,618 per 10 gram. Silver also faced selling pressure as it tumbled by Rs 1,588 to Rs 59,301 per kg from Rs 60,889 per kg in the previous trade. In the international market, gold was quoting lower at $1,830 per ounce and silver was flat at $23.42 per ounce.
"Gold prices traded lower in the morning trade extending decline on vaccine hopes and Biden's white house transition as US President," HDFC Securities Senior, Analyst (Commodities) Tapan Patel said. Navneet Damani, VP – Commodities Research, Motilal Oswal Financial Services said, "Gold fell as better-than-expected US business activity data and optimism over progress in Covid-19 vaccine boosted hopes for a swifter economic rebound and drove investors towards riskier assets."
Mumbai: Futures of gold, which were soaring well above the Rs 50,000 mark till sometime back amid the weak economic scenario, have now started to ease and have fallen below the Rs 49,000-mark amid optimism regarding vaccines for the novel Coronavirus.
The December contract of gold on the Multi Commodity Exchange (MCX) is currently trading at Rs 48,975 per 10 gram, lower by Rs 505 or 1.02 per cent from its previous close. Similarly, domestic futures of silver also continued its downward trend on Tuesday and its December contract on the MCX is currently at Rs 59,825 per kg, lower by Rs 700 or 1.16 per cent from its previous close.
Anuj Gupta, DVP for Commodities and Currencies Research at Angel Broking Ltd said that noted that the decline has been on the back of recovery in global equity market and development on the front of corona virus vaccine. Gold ETF holding is also falling more than a million ounce in this month, he said.
"The trend of gold and silver now become down and expectation of safe haven demand of this asset may fade out. As for today traders can go for sell in gold at Rs 49,800 levels with the stop loss of Rs 50,100 levels for the target of 49,000 levels," Gupta said. In the international market, gold may test $1780 to $1800 per ounce levels soon, according to him.
He was of the view that traders can also go for sell in Silver at Rs 61,000 levels, with the stop loss of 61,800 levels and for the target of 59,800 levels. Optimism has been fueled in the global markets after the recent series of positive announcements on the vaccine front. AstraZeneca on Monday announced that positive high-level results from an interim analysis of clinical trials of the Covid-19 vaccine candidate in the UK and Brazil showed it was highly effective in preventing the disease, the primary endpoint, and no hospitalisations or severe cases of the disease were reported in participants receiving the vaccine.
One dosing regimen showed vaccine efficacy of 90 per cent when 'AZD1222' was given as a half dose, followed by a full dose at least one month apart, and another dosing regimen showed 62 per cent efficacy when given as two full doses at least one month apart. The combined analysis from both dosing regimens resulted in an average efficacy of 70 per cent.
All results were statistically significant. More data will continue to accumulate and additional analysis will be conducted, refining the efficacy reading and establishing the duration of protection.