After witnessing some setback in recent weeks, Gold futures have rallied again in the Asian trading session early morning on Monday. The recent surge can be easily attributed to certain hedge funds and other speculators, which augmented their long bets on this metal even though it was trading quote low last week in various markets.
The yellow metal futures for June delivery saw a surge of around 0.66 % to USD 1,404.85 per troy ounce on the Comex division of the New York Mercantile Exchange on Monday’s Asian session. The drop in bullion by 5.4 % during the initial two trading days last week might have played a role in the kick-start that Gold futures got in the beginning of this week. Financial experts estimated that the price of Gold would find some support if it trades at USD 1,322.25 a troy ounce, which was the lowest mark in 27 months. The analysts had predicted that Gold might get some resistance at USD 1,425.55, the mark it reached on Friday.
The latest reports released by the U.S. Commodities Futures Trading Commission signified that fund managers and investors had increased the net long exposure to gold by almost 9.8 % to trade at 61,579 futures and options in the last week of the month of April.
Despite the resistance and struggle gold faced in the spot market, its physical demand did not decline at all. As per the data released by China Gold Association, their sales went high when gold prices went down on April 15 and 16. The Bombay Bullion Association also expects to see the sales in India go up by 36 % for three months through June, prior to the Akshya Tritiya festival.
India and China are the largest and second-largest gold consumers in the world, in that order. Around 20 % of the global gold imports were done by India last year. The U.S. Mint also saw this month post the highest sales in last three years. As per the economic data revealed by CFTC, short positions in gold saw a decline of 8.2 % to finish at 59,742 contracts.
Coming to the other metals, silver also witnessed a surge of 0.72% to USD 23.125 per ounce on the Comex division for May delivery. On the other hand, copper dropped by 0.95 % for May delivery on Comex to trade at USD 3.119 per ounce.