Wednesday, July 21, 2010

Indian Gold Buying Slows Down As Prices Advance

According to a report by the Economic Times, gold buying retreated because traders are waiting for lower prices to stock up, with a weakening rupee still holding back demand:
"Buying receded after prices moved above $1,190 (an ounce) last evening, even the rupee is not acting in favour," said a dealer with a state-run bank in Mumbai, which deals in bullion....

"If prices fall below $1,175, then most of my buy deals would get triggered," said another dealer with a private bullion dealing bank.

$1,175 is lower than recent prices reported by that same source. This could be because buy orders at above that price were taken out, but the weakening rupee is also influencing the drop-down. So is downwards price acclimatization, encouraged by a slump to that same $1,175 early yesterday morning. It may only be me, but those traders seem more eager to get on the low end of the market than in the spring.

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