In our daily report we had given a bullish outlook for gold. However our outlook was partially correct but in the later session at U.S hours, it failed to breach its lifetime high and took a minor correction with settling the December futures at $1257.50 levels.

Moreover, other factors also made gold to trade slightly lower. The similar movement was also observed in Indian gold as the October futures ended at Rs. 19106.

Key Observations

Gold for December delivery failed to breach its life-time high. The similar move was also witnessed on Spot gold overseas

Gold-dollar relation has again lined up. Dollar index declined -0.31% to settled at 82.585

Gold prices closed marginally lower as equity (DJIA- futures) stood higher by around 0.45%

Outlook

Gold prices which have ended marginally lower, may instigate further profit booking on today’s trading session. However, the overall trend remains bullish. Certainly, a correction can be expected during Asian and European trading hours. This correction may be a value point for buying opportunity on gold.

All the Asian equities are trading lower except shanghai futures. This may also push investors to make profit booking on gold. The recently released news at Shanghai regarding illegal funding on commodity market may have some negative impact on gold prices too.

Coming onto economic releases, we have trade balance and jobless claims from U.S which are expected to be better for the economy. In this regard, gold may take correction. However, this looks like investors might have discounted onto the expected figure. Any significant change on these data will drive the bullion market.

At the Indian front, gold may open flat but rupee appreciation could limit the gains on domestic gold prices.

Courtesy: Karvy Commtrade Ltd.

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