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After falling over 3 per cent in February, the MCX-Gold futures contract managed to bounce back last month. But the bounce-back lost momentum and the contract fell 1.8 per cent last week, giving back most of the gains made earlier in the month. A fall in the global gold price, coupled with a strong rupee, dragged the MCX contract lower. Immediate support is at ₹28,500 per 10 gm and the next is in between ₹28,150 and ₹28,000. Though a test of these supports cannot be ruled out, a fall below ₹28,150-28,000 is less likely. Traders can go long on dips near ₹28,500 and accumulate near ₹28,150. Keep the stop-loss at ₹27,700 for the target of ₹29,500. An upward reversal from ₹28,500 or ₹28,000 may take the contract higher to ₹29,500 and ₹29,650. A strong break and decisive weekly close above ₹29,650 will increase the likelihood of the contract extending its rally to ₹30,300. The outlook for the contract will turn negative only if it records a decisive weekly close below ₹28,000. Such a break can drag the contract lower to ₹27,500 or ₹27,000.
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