Mcx India - Gold Monetization Scheme & Gold Outlook Report

GOLD MONETIZATION SCHEME - MCX INDIA

Gold Monetization Scheme has as of late been proposed in India's yearly plan, to top general interest of gold on the planet's second biggest shopper. Gold adaptation plan is prone to expand the supply of gold to the gems business furthermore for speculation. Through this plan, banks can channelize gold held by families, magnanimous trusts, sanctuaries and other such foundations to the industry. With gold adaptation, ventures like higher import obligation won't be obliged to control interest for gold. The adaptation plan will help in methodical reusing and will upgrade straightforwardness that will advantage a huge number of family units and the macro economy, as it will change over gold investment funds into financial ventures.

It was additionally proposed in this financial plan that India ought to present its own particular gold coins. Standard Indian gold coins will guarantee gold accessibility adjusted to client inclination and will help in controlling the informal business. According to gauges, the gold monetization plan is prone to lessen import of gold definitely by 30 - 35 percent a year. The move will help survey genuine import of gold in the nation and lay more weight on fortifying the endeavors to open more household gold.



These two measures, gold adaptation plan and presentation of standard gold coins, are gone for bringing down gold imports. India relies on upon imports of gold for about 95% of its yearly request. This is an endeavor to achieve tremendously required coherence between physical resources and budgetary resources. With gold adaptation coming set up, the Indian interest for gold going ahead is liable to decrease in nearing years that may be somewhat bearish for gold.

GOLD OUTLOOK REPORT

After the catastrophic decline of 2013, gold continued its descent in 2014, but still the decline is being viewed more as a consolidation rather than a correction. The decline was only of around one and a half percent on the COMEX. However, at the MCX, gold witnessed a downbeat year losing around six percent. Gold seems to have got buried by the winds of deflation, but the big question is will gold recover and gets its sheen back and rise like a phoenix ? When it comes to prophesying about the overall trend ,nothing divides opinion like the yellow metal and exuberance most often overshadow rational and logical thinking. With battlefields drawn for 2015, the bulls have a strong armored wall of Rs25000/Kg at the MCX Market, whereas the bears have used their artillery many a times to make a crack in the wall but have failed. After hitting a high of Rs30700 / Kg in 2014, gold has witnessed a correction and has made lower tops and lower bottoms. The tussle between the bulls and bears has resulted in trading opportunities at regular intervals but none of them proved their might to give a one sided thrust to prices. 

At COMEX, prices cracked below the multi - year support of $1180/oz and tested lows of $1131.15/oz, but bulls managed to absorb the selling pressure and damage was controlled. The prices resurrected and entered a trading range. At MCX, the sanctity of Rs25000/Kg level has been maintained. If we plot the Fibonacci retrenchments of the larger trend that started in June 2007 from Rs8600/Kg odd levels and continued till Rs35000/10gms odd levels, the 38.2 percent retrenchment comes in around Rs25000/Kg mark. The current consolidation seems to be a corrective leg of the overall secular bull run of the shiny metal. The chart pattern and the weight of the technical evidence are suggestive of a consolidation at current prices, before we see prices heading north. If bulls are able to give a closing above Rs28300/kg, then gold's renaissance will begin and possibly bears will have to go for a long holiday .The bulls, perhaps will take center stage till the pr ice s touch Rs31000/10gm. However, the only caveat is the armored wall of Rs25000/10gm ,that if broken on a closing basis ,will result in a painful time for gold bulls and a sell off may begin that will morph into a tough phase for gold and may knock it down to around Rs22000/10gm levels.

The COMEX chart does not resonate well with the MCX chart, due to rupee fluctuations but nevertheless the crucial support at the COMEX is of $1100/oz and till the time this level is not breached, investors can remain exuberant for higher targets o f $1400/oz. The strategy would be to accumulate gold at lower levels of around Rs25500 - 25900/10gms for targets of Rs 30700 - 31200/10gms in medium term, while a stop loss below Rs 24300/10gms on a closing basis should be maintained.

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