Commodities » Precious Metals

Spot Gold prices touched a low of $1106/oz on Wednesday.

Contributed by Angel Broking

By Amar Singh, Reena Walia Nair (Angel Broking)

MARKET RECAP

Spot Gold prices slipped on Wednesday as strength in the dollar by the end of the trade pulled the yellow metal lower. The US Dollar strengthened after the Dow Jones witnessed selling pressure and led to risk aversion in the financial markets. This led to increased demand for the low-yielding dollar. Economic data from the US came on the positive side as US ISM non- manufacturing PMI data came at 50.5 in January as the highest since May 2008, rising from the previous reading of 49.8 in December. The US Dollar gained broadly on Wednesday on the back of lower-than-expected private sector job losses as well as stronger-than-expected economic data. US ADP employment decreased by 22,000 in January versus forecast of a decrease of 54,000.

OUTLOOK

Gold prices could come under pressure if the dollar strengthens on the back of risk aversion. Strength in the dollar could put downside pressure on gold prices and the yellow metal could trade with a negative bias.  Gold prices will take cues from the economic data releases from the US today.

On intraday basis, Spot Gold prices have immediate support at $1102/$1095 whereas resistance is seen at $1114/$1120. Spot Silver prices shall find support at $16.08/$15.80 whereas resistance is seen at $16.50/$16.77.