Markets are in a downward spiral because of inflation, FIIs outflows and weak global cues. The 30 share BSE Sensex sank more than 1,000 points to hit an intraday low of 53,047. The NSE Nifty and the 75 fell over 300 points to 15,848. As an investor, you might be wondering where to park your funds right now. It's a fact that gold is used as an inflation hedge. There was a three month low on Wednesday, as prices on the international market touched a three month low.
The Federal Reserve stance and demand for bullion might be affected by the drop in rates because of the elevated dollar holding down prices while investors wait for US monthly inflation data.
On Thursday, the MCX gold futures on the Multi Commodity Exchange of India Limited were trading at Rs 50,850.
Should you invest in the yellow metal as gold hovers around Rs 50,000 per 10 gram?
According to Ravi Singh, the price of gold may be near the levels of 49,500 in the coming weeks, according to ShareIndia.
He said that gold prices are supported by higher inflation and geopolitical fluctuations, however, physical tightening measures by central banks to curb inflation and a stronger dollar are pushing gold to lower levels. Longer-term gains may be achieved by investors in gold.
AVP Research Commodities, Ganganagar Commodity Limited said that Gold and Silver prices are trading down in the morning. The June Gold futures on the Multi Commodity Exchange MCX are trading 50803, 0.19% down, and July Silver is trading at 60338, 0.68% down today due to high dollar index prices. He said that the dollar index futures are trading at 104.145, which is a lifetime high. The dollar index is making a temporary top and showing some profit booking as per the technical chart.
The investors are looking for a safe-haven investment in the current situation. He said that the price of gold and silver has been falling for the last 3 weeks and prices are trading at 3 month low.
If we talk about technical levels as per June contract chart, 50300 -- 49800 are the best prices for Gold investors to make a fresh investment for 3 to 5 per cent return in a short term of 1 -- 2 months. He added that Price can also test the 53,400 level in the next 3 month period.
After the dollar's reversals and decreasing US treasury yields predicted more hikes in the future, gold has seen some reversals in the past after a rebound in inflation. A weaker dollar will make gold attractive to outsiders, according to Manoj Dalmia Founder and Director-Proficient Equities Limited.
In the near term, it might hit 52,179 levels as a result of the gold futures continuous current contract. He said that gold can be bought in the short term with a stop loss of Rs 50,198 and a target of 52,198.