Gold and silver prices were trading higher in early trade on Tuesday on account of some demand for precious metals from jewellers, retailers, investors and industries.
MCX Gold futures were trading 0.04 per cent up at Rs 31,715 per 10 gram at around 11 am (IST), while MCX Silver futures were up 0.03 per cent at Rs 38,370 per 1 kg at around the same time.
According to SMC Global Securties, gold can take support near Rs 31,600 and can face resistance near Rs 31,850 in MCX. While silver can take support near Rs 38,100 and can face resistance near Rs 38,700.
“In the international market, Gold prices were steady early Tuesday ahead of US midterm elections that may fuel interest in the metal as a hedge against risk if the result sparks volatility in wider financial markets. Opinion polls show strong chances that the Democratic Party may win control of the House of Representatives in the Nov. 6 midterm elections,” said SMC Global Securities.
The metal is down more than 5 percent this year, with investors turning to the dollar for safety as the US-China trade war unfolded, and higher US interest rates offered more attractive returns than the non-yielding metal.
Bullion traders also awaited this week’s Federal Reserve meeting to gauge the outlook for US monetary policy. Hedge funds and money managers raised their net short position in gold to a three-week high in the week ended October 30, according to the US Commodity Futures Trading Commission data.
Also, highlighting investors’ bearish sentiment toward bullion were holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, which fell 0.23 percent to 759.06 tonnes on Friday.
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