Daily Times

Gold prices remained on the downward slide for the second day in a row on Thursday. As of 1330 hours GMT, gold in the international market was available at $1,820.70 per ounce, shedding $4.80. However, despite the pullback in gold price, the upside bias remains intact.

However, the price of 10 grams of yellow metal in Pakistan went up to Rs103,200 after gaining Rs200. Gold in the local market was available at Rs103,000 per 10 grams on Wednesday. An increase in the local gold prices was due to overnight increase in the gold price globally when the local market was closed. Also, Pakistani rupee eased by 0.09 percent (15 paisa) against the US dollar during the day, which was also a factor behind surge in the local gold prices.

According to experts, gold went down despite the US dollar losing purchasing power. They said that falling dollar capped losses for the yellow metal. The American dollar entered a sell-off spiral on Wednesday evening following the release of US inflationary figures for December. Inflation rose by 7 percent, the fastest annual rate since 1982, a sign that inflationary pressures are far from receding amid surging consumer demand and overburdened supply chains. However, on a month-on-month basis, prices rose from the prior month by 0.5 percent in December, easing from a 0.8 percent gain in November.

From a technical perspective, immediate support is pegged around the $1,815-12 level. Hence, any further pullback is more likely to attract fresh buying and remain limited near the $1,800 mark. Failure to defend this level might prompt some technical selling and accelerate the fall towards the $1,790 region. A convincing break below this support level will be seen as a fresh trigger for bearish traders and pave the way for deeper losses.

On the flip side, bulls are likely to aim back to test a static resistance near the $1,830-32 region. A sustained strength beyond would set the stage for a further near-term appreciating move and push gold prices towards the next relevant hurdle near the $1,848-50 region. The momentum could further get extended towards the $1,869-70 area en-route the $1,877 zone, or a multi-month high touched in mid-November.