The gold price was a record high during recent times but the yellow metal dropped the worth by 7.5 per cent per 10 grams and silver prices have elevated 14.6 per cent per kilogram. It took nine trading sessions for gold to climb from $1900 to $2000 but only took one day to crash from $2000 to $1890 and 4 trading sessions for silver to gain from $25 to $30 and crashed in just one day from $29 to $23.50.
The gold price has fallen in Indian markets due to the profit booking because of the increase in US yields, recovery of the US dollar and progress of Covid-19 vaccine by Russia. In the previous session, gold crashed by 3.4 per cent which was the poorest daily drop since 2013, below $1900 and then increased 2 per cent which gave us a solo day move of almost 6 per cent.
As the prices of gold and silver were highly increasing and a correction was expected by everyone still such a sharp decline was not anticipated in a short period was the opinion by Bhavik Patel, a Senior technical
Research Analyst at Tradebulls Securities. During last week, the gold price hit a record of Rs 56191 per 10 grams and silver touched a record of Rs 77949 per Kg. But the sudden fall is of Rs 4211 or 7.5 per cent per 10 grams and for silver, the fall was of Rs 11415 or 14.6 per cent from the respective peaks. Gold in October futures was trading at Rs 265 or 0.51 per cent down at 51,980 per 10 grams, whereas silver in September futures fell Rs 219 or 0.33 per cent to rule at Rs 66,534 per kg.
It is evident and the Fed officials stated that the US economic growth and recovery will be slow until the pandemic is not under control and things get back to normal. We have to live with this virus for at least some more months and it will affect the market and investor sentiments. Market participators will keep a judgement on the US weekly jobless claims data.
The gold prices were 46 per cent up from March 2020 till last week and silver prices rallied over 132 per cent to hit the respective record highs. On a technical basis, the exaggerated move occurred also did not cause any damage to the chart. The correction is expected to be short term buyers were willing to purchase even on a lesser price.
