India gold futures shed over 3 per cent in early trades on Tuesday as investors resorted to profit-taking to benefit from the almost 4 per cent gain in the previous three sessions,analysts said.
“We expect this profit-booking to continue in gold till 15,000 levels,” said Devarsh Vakil,manager-research,Anagram Capital in Ahmedabad,”we expect a reversal in equities which could prove negative for gold.”
Weakness in equity markets typically leads investors to gold,which is seen as a safe haven.
“Gold is strongly supported at 15,000 (rupees),” said Vikas Vaid,an assistant vice-president with Asit C. Mehta Commodity Services,adding “gold’s movement would also be dependent on fluctuations in rupee.”
The Indian rupee strengthened on Tuesday from the previous days’s record lows,making the largely imported yellow metal cheaper in local markets.
The benchmark April contract was 2.59 per cent lower at 15,397 rupees per 10 grams at 11:44 a.m.,after hitting a low of 15,305 earlier.
“Dips should be used as an opportunity to go long in gold with a long-term perspective,” added Vaid.
Open interest for April gold on MCX was at 19,207 lots,down from 17,636 a day earlier. Volume on Monday was 75.45 kg.