MUMBAI (Commodity Online): India Gold futures at Multi Commodity Exchange (MCX) is now witnessing a consolidation phase after Dhanteras, and pre-Diwali buying helped push up prices early this month.

On Wednesday trade, MCX Gold has now fallen into negative territory at 31710 per 10 grams after hitting a high of Rs 31748. Volumes hit a high of close of 60,000 lots in the first week of this month but has now fallen to 34000 levels while open interest has fallen from a  high of 21703 lots to 13880 lots.

“On daily charts, Gold’s upward rally seems to have paused for temporarily at $31700 levels and weaker rupee, weak rural demand on account of lower kharif season rains have caused the setback to the yellow metal,” according to Sreekumar Raghavan, Chief Commodity Strategist at Commodity Online.

Dhanteras on Sunday (11^th November) witnessed some brisk selling ahead of Diwali, as the day is considered auspicious to buy the yellow metal.   

Support levels for Gold December remains intact at 31,000, 30,500 levels for the near term while resistance is seen at Rs 31850, 32000 levels. Sideways trading indicated for the rest of the week. Meanwhile, Comex Gold Dec is also showing weakness after a rally triggered by Obama’s victory in US Presidential election for a second time last week. However, on technical charts, MACD remains in positive territory, Sreekumar Raghavan added. 

US Gold futures have weakened as nations could not reach an agreement on how to disburse more money to Greece that prompted bullion investors to book profits, analysts said.