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After getting support at ₹25,500/10 gram in mid-March 2015, MCX gold has been trending upwards. It has retraced 50 per cent (fibonacci retracement level) of its prior downtrend and hovers sideways around ₹26,800 with a positive bias. It trades well above the 21- and 50-day moving averages.
Both daily and weekly price rate of change indicators feature in the positive territory implying buying interest. Other indicators on the daily chart show a positive bias.
Traders with a short-term perspective can make use of dips to buy while maintaining a stop-loss at ₹26,450 for the target of ₹27,000 initially and then to ₹27,300. Next resistance is at ₹27,500 levels.
A decisive rally beyond ₹27,500 is needed to will pave way for an up move to ₹28,000 in the short to medium-term.
On the downside, an emphatic fall below the immediate support level of ₹26,500 can alter the bullish outlook and drag the yellow metal down to ₹26,300 or ₹26,000 levels.
On the global front, the global spot gold hovers around $1,190/ounce. The immediate key support is placed at $1,180 levels.
An upward reversal from this base can take the gold price higher to the key immediate resistance level of $1,220 in the short-term.
Next significant resistances are at $1,240 and $1,260 levels. Supports below $1,180 are pegged at $1,150 and $1,130 levels.
Note: The recommendations are based on technical analysis. There is a risk of loss in trading.
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