Last Updated :
19 January 2009 at 20:00 IST
Got money? Buy Gold & wait!
Commodity Online
NEW DELHI: Even as investors across the globe are pitching for gold what is reining in gold prices in India.
If you analyze last weeks trends, gold, after being in the grip of bears for the most part of the week, recovered during the weekend. On Friday, it gained three per cent to close at $847.2 an ounce but during late fixing, it slipped to $833.75, indicating the continuing volatility.
So, gold is not soaring as expected. The reasons is the global meltdown impact. In reality, people have stopped buying the yellow metal from spot markets because of the shortage of liquidity.
Even though people are sure about the prospects of gold, they are not buying it from the market because for the prices are still high.
What is keeping gold under leash is low physical demand and less money with investors to buy the yellow metal.
Following this trend, there are expectations that gold prices may slump to $500 per ounce on lack of demand.
After touching $1,030 an ounce in March last, gold has been witnessing high volatility.
During the last week of December, gold touched $890 before slipping to nearly $800. A section of analysts have put the average price of gold this year at $825.
The main reasons for gold falling prey to bears is that demand for it is the lowest in almost a decade. Because, prices are too high for buyers still.
Technically, $895 is seen as the key resistance point for gold. Support for it is around $808.
The precious metal has gone below one of the key support level of $841 and has not been able to scale over the short-term resistance of $868.
However, gold’s prospects seem to be bright in the long term. Because the rich people are buying gold bars as an investment. Because those who have money know that gold is the best option for them to invest.
The rich are asking for gold bars as they are worried over how economy would behave this year. So, investors are preferring physical gold over even exchange-traded gold funds.
The current global situation is such that there is a fear that deflation may set it. In that case, there is nothing as safe as gold. Silver is set to tail gold, while the platinum group of metals will see some spark only on economic revival.
MCX SOYABEAN 01 January 2020
contract was trading at
Rs 0 . What's your view on it?
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