Gold Price Today: Investors with short term view must book profits now; import duty hike, rupee weakness may arrest price correction, temporarily

Investors in gold with a short term view must book profits now, says expert Anuj Gupta. He said that internationally, the prices are coming down and the price correction will start to show in the domestic markets, as well

Price of yellow metal breached an important support level of USD 1800 today and he sees it testing levels of USD 1770. Source: Reuters

Investors in gold with a short term view must book profits now, says expert Anuj Gupta. He said that internationally, the prices are coming down and the price correction will start to show in the domestic markets, as well.

The import duty hike along with a weaker rupee may not hold gold prices in India for long if the prices fall globally, Gupta said adding that gold could become dearer for investors back home, only temporarily.

The price of yellow metal breached an important support level of USD 1800 today and he sees it testing levels of USD 1770.

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Higher import duty and stronger US Dollar against the INR may appear as a double whammy to investors, but eventually the falling prices in international markets will have an impact here too, the Vice President (VP), Commodity and Currency Research at IIFL Securities said.

The government has increased duty on gold imports on Friday from 10.75 per cent to 15 per cent to arrest the slide of rupee. The surge in gold imports is putting pressure on current account deficit, a media release by the Ministry of Finance said. In May, India imported 107 tn gold and June exports are likely to remain high as well, this release said.

India is one of the largest importers of yellow metal and the demand for Gold could take hit because of the import duty increase, the VP said. Linking likely decrease in Indian gold imports to possibility of oversupply in global markets, he said that prices could further fall in international markets.

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Gupta’s advice for investors is to book profits id they are looking at quick gains. He has been giving a buy strategy on gold and silver futures, lately.

He said that the news of higher duty helped the MCX August futures gain almost 1400 points. At 9:30 pm on Friday, the prices were up 2.7 per cent from the last closing price on Thursday. “We are recommending sell on rise with the stoploss of 53000 for the target of 50500 to 50000 levels,” Gupta said.

He sees a strong support in Gold futures at Rs 50500 and then at Rs 50000 levels while first resistance level at Rs 52300 and then at Rs 53000 levels.

Meanwhile, July Silver futures were trading at Rs 58304 and were up Rs 583 or nearly 1 per cent around this time. He sees first support at Rs 57000 and then at Rs 54000 and resistance at Rs 61000 and 63000 levels.

Selling is advised at Rs 61000 with the stop loss of Rs 63000 for the target of 57000 levels.

Gold last month corrected by more than 1.50 per cent and silver corrected by more than 3 per cent.

(Disclaimer: The views/suggestions/advises expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)

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