Gold entered the bear market today due to the rise in US Treasury yields and strong dollar. Gold-based exchange traded funds (Gold ETFs) continue to be under selling pressure on gold, as upward momentum is not visible in gold. Let us tell you that when the price of an asset, commodity or securities falls 20% or more from its record high and the yag fall is more than two months, then it is called beer market.
With the impact of the corona virus coming to a standstill in the global economy and growth outlook being positive with interest rates stabilizing, investors are now looking for better and more profitable opportunities for investment, leading to higher gold prices. Has declined. PR Somasundaram, managing director of World Gold Council India, said that gold ETFs’ holdings fell by more than 2% in February due to rising bond yields and falling gold prices.
PR Somasundaram said that during this period, the holding of Global Gold ETFs declined by 84.7 tonnes of gold. He said that this is the 7th largest monthly loss in history so far. The holding of SPDR Gold Trust, the world’s largest gold-based exchange traded fund, reached its lifetime high of 1,278.82 on September 21, 2020, a decline of 200.5 tonnes, or 15%, by 4 March 2021.
At the same time, there is a continuous uptrend in the 10-year US bond yield. They were trading at 1.55% today after hitting an alltime high of 1.61% in the last week of February 2021. Shriram Iyer, senior research analyst at Reliance Securities, said that gold could fall to the level of 44,000 per 10 grams and if it falls below that it could come down to 42,250. Gold support levels in the dollar can be between $ 1,685-1,660. He said that it can also test $ 1600 per ounce level.
Kshitij Purohit, Product Manager, CapitalVia Global Research, shouted at Shriram Iyer’s note that Gold is likely to trade between Rs 43,800 and Rs 44,000 on MCX. At the same time, it can be between 1,685-1,660 on COMEX. He said that if the bond yield continues to rise, gold prices may fall to 41,500 per 10 grams. At the same time, Navneet Damani, Vice President of Motilal Auswal said that gold on MCX is estimated to be between 44,200 and 43,500. Today, futures gold for delivery in April on MCX closed at Rs 44,540 per 10 grams.
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