Bullion - Commodity Snippet - Dec 11, 2020 - Reliance Securities

International gold and silver ended flat to marginally lower surrounding vaccine development after an advisory panel to the U.S. Food and Drug Administration recommended approval of the pharma's Covid-19 vaccine for emergency use.

Investors also shrugged off weak U.S. jobs data. Initial claims for state unemployment benefits surged 137,000 to seasonally adjusted 853,000 for the week ended Dec. 5, the highest since mid-September. Economists polled by Reuters had forecast 725,000 applications in the latest week.

However downside was capped after the European Central Bank eased policy once again on Thursday to help the euro zone economy cope with the second wave of the coronavirus pandemic.

The ECB increased the overall size of its Pandemic Emergency Purchase Programme by 500 billion euros to 1.85 trillion euros and extended the scheme by 9 months to March 2022, with the aim of keeping government and corporate borrowing costs at record lows.

Safe appeal for the yellow metal remained intact amid rise in covid-19 cases.

Domestic gold and silver crashed on Wednesday, tracking weak overseas prices.

International and Domestic Outlook

International spot gold and silver prices have started marginally higher as the U.S. dollar fell this Friday morning in Asian trade.

Prices also inched higher as rising covid-19 cases and weak U.S. jobs data cast doubts over a swift economic recovery.

Markets will now to cues from the Fed meeting next week and any fresh triggers from the U.S. fiscal stimulus talks.

A U.S. Senate vote on a stopgap measure to keep the government running is likely to go to the Friday deadline.

Technically, LBMA Gold Spot traded on flat note where it is trading below $1840 levels indicating a Bearish to marginal sideways momentum in the coming sessions. Support is at $1826-$1816 levels. Resistance is at $1845-$1854 levels.

LBMA Silver Spot continue its Bearish momentum below $24.00 could take prices to $23.70-$22.40 levels where Resistance is at $24.60-$25.12 levels.

Domestic bullion could start flat to marginally higher this Friday morning, tracking the international prices.

Technically, MCX Gold February holds a resistance near its 21-Daily Moving Average which is at 49510 levels below which will continue its downside momentum. Support is at 48900-48600 levels. Resistance holds at 49300-49650 levels.

MCX Silver March traded in a range of 62900-64400 levels where it is expected to consolidate within this range where breakout above 64500 could continue its bullish rally. However below 63000 levels could see some sideways to marginal downside momentum.

MCXBULLDEX December gave a sharp correction from 15450 levels where it traded on negative note. It could trade in a range of 15050-15350 levels.

Source : Equity Bulls

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