Gold It Trading Above Key Support, Bias Still Bearish
Gold looks higher as long as price holds above its Key support at the 1,077/1,069 zone.
Support comes in at 1,080.00 mark where a break will point to 1,069.00. A break there points to 1,040.00, a break there sees Southside pressure to 1,000.00.
On the Northside
Resistance stands at 1,210.08 where a break points at 1,225.000, then 1,250.00. A break there turns the focus to 1,270.00 followed by 1,180.00.
Overall, Gold remains biased to the Southside medium term, but is seeing corrective recovery opportunity.
India, the world’s 2nd-biggest Gold buyer after China, imposed the import restrictions last year to avert a trade deficit crisis that pushed the Rupee to record lows.
“Restrictions placed on import of Gold… stand withdrawn with immediate effect,” India’s central bank said in a statement on Saturday, 29 November.
Support for Spot Gold comes from jewelry demand from India in the lead up to and during the wedding season, which started in late September. India did record a 176% increase in Gold imports in August to US$2-B from about US$756-M.
Overall, the impact of wedding season Spot Gold buying has faded in recent times as India is no longer the world’s largest Gold consumer, partly because of the on-going government import restrictions on precious metals. If they are further relaxed, perhaps India will regain its Top spot.
India’s Akshaya Tritiya festival considered by India’s more than 900-M Hindus as an auspicious day to buy Gold and Silver, fell on 21 April this year. Bullion is bought in India during festivals and marriages as part of the bridal trousseau or gifted in the form of jewelry by relatives.
HeffX-LTN
Paul Ebeling
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