Bullion

Gold rose in MCX above Rs. 10450 per 10 grams after a gain in crude oil boosted the appeal of the precious metal as a hedge against accelerating consumer prices. Gold for February delivery on the Comex division of the New York Mercantile Exchange was little trading above $820 an ounce.

The dollar dropped as much as 0.6 percent against the euro on Wednesday after gaining 1.6 percent in the past two weeks. Investment in the StreetTracks Gold Trust, an exchange-traded fund backed by bullion, has climbed to a record 617 metric tons. Before today, the precious metal advanced 28 percent this year as the dollar fell 8.4 percent against the euro.

Gold futures also rose on Comex supported by copper's rally and the US dollar's slump on a day of holiday-thinned trading. US and UK markets were closed on Tuesday for Christmas holiday.

MCX Gold Feb (Daily Chart)

Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Gold Feb: Buy at 10420-400 for the target of 10480 and 10555 with stop loss at 10365



MCX Silver Mar (Daily Chart)



Technical Outlook:

Momentum studies have turned bullish; will tend to support reversal action if it occurs. The daily stochastics have crossed over up which is a bullish indication. The stochastics indicators are increasing from over sold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 18-day EMA. The downside closing price reversal on the daily chart is somewhat positive.

Recommendations:

MCX Silver March: Buy at 19380-340 for the target of 19640 and 19780 with stop loss at 19240