By Mr. Naveen Mathur, Reena Walia Nair (Angel Broking)

MARKET RECAP

Spot gold prices gained for a second consecutive day to close at $1167/oz on Thursday. Lower prices attracted some investors towards the yellow metal. Moreover, the weakness in the US dollar index (DX) also supported the gold prices yesterday. However, sharp trigger was not witnessed in the yellow metal prices on the back of easing concerns over a sovereign debt crisis in the Euro zone. Gold prices have suffered drastically in the last couple of sessions after the announcement of the stress test results of the Euro zone banks. Concerns over a sovereign debt crisis are easing and demand for safer investments like gold is declining.

OUTLOOK

Financial markets continue to trade on a choppy note. Hence, the DX is expected to strengthen today as choppy equities will increase demand for the currency as a safe-haven. This factor will exert pressure on the gold prices as the yellow metal has the tendency of trading inversely to the greenback.

On intraday basis, Spot Gold prices have immediate support at $1160/$1153 whereas resistance is seen at $1173/$1180. Spot Silver prices shall find support at $17.26/$17.05 whereas resistance is seen at $17.71/$17.95 levels.