Technically Gold market is under long liquidation as market has witnessed drop in open interest by 5.93% to settled at 13748 while prices down 205 rupees.
Now Gold is getting support at 31442 and below same could see a test of 31358 levels and resistance is now likely to be seen at 31654, a move above could see prices testing 31782.
Gold on MCX settled down -0.65% at 31527 as the dollar stayed steady against most major currencies after the European Central Bank lowered eurozone growth projections for the coming year.
The dollar firmed against major counterparts as investor focus shifted to an expected U.S. interest rate hike next week, although gains are likely to be capped on greater uncertainty about next year's policy outlook. The ECB President's warning that the "balance of risks is moving to the downside," and the lowering of GDP and inflation forecasts for the eurozone resulted in the euro losing ground against the greenback.
Gold's losses, however, were limited due to rising expectations that the Federal Reserve will pause monetary tightening in the coming year. The Fed, which is likely to raise interest rate by 25 basis points after its policy meeting next Wednesday, is also expected to cut its forecast of 2019 rate increases.
Meanwhile, U.S. President Donald Trump said that he hopes the Fed "won't be raising interest rates anymore." The number of Americans filing applications for jobless benefits tumbled to near a 49-year low last week, which could ease concerns about a slowdown in the labour market and economy.
The risk of a U.S. recession in the next two years has risen to 40 percent, according to a Reuters poll of economists who also found a significant shift in expectations toward fewer Federal Reserve interest rate rises next year.
--Gold trading range for the day is 31358-31782.
--Gold prices slipped as the dollar steadied and equities climbed on signs of easing trade tensions between the United States and China.
--There are signs of easing trade tensions between the world's top two economies, and expectations that China will step up efforts soon to support its cooling economy.
--However, uncertainties around the Brexit deal and expectations of the U.S. Federal Reserve's dovish tone at its meeting next week, supporting the prices.
Courtesy: Kedia Commodities