Last week, gold prices were down internationally on the back of a strong dollar, coupled with long liquidation in gold exchange traded funds. However, in the Indian market, the fall in gold prices was curbed due to a weak rupee as well as demand coming in on the occasion of Akshaya Tritiya.
Gold internationally was down 1.3 per cent to $1,448.20 per ounce, while on the Multi Commodity Exchange
, the yellow metal closed at Rs 27,119 per 10g, down one per cent.
In the coming week as well, gold is expected to follow the same fundamentals as last week.
"There is nothing which will cause gold prices to move up as the dollar has gained momentum. Investors are now moving out of commodities and investing in the dollar," said Naveen Mathur, associate director (commodities and currencies), Angel Broking, a Mumbai-based broking firm.
The medium-term outlook for the yellow metal continues to remain weak, as liquidation in the metal is expected to continue and this will cause prices to fall. Gold has lost its safe haven appeal, according to analysts.
Also, the sell-off is across all commodities as investors now prefer investing in riskier assets.
"I don't see gold moving beyond Rs 27,600 (per 10 gm) in the Indian market, and this rise will be seen mainly due to demand due to Akshaya Tritiya. However, internationally, gold is seeing strong resistance at $1,485 per ounce, which it has not been able to break, and strong support is seen at $1,412 per ounce, if that support is broken, then the yellow metal will fall to $1,364 per ounce," said Ajay Kedia, managing director of Kedia Commodities.