In India, the commodity market is full of opportunities and avenues. Commodity trading is an old professional path, dating back further than trading bonds and stocks. Nowadays, various avenues of commodity trading have been opened. The bullion section is one of them. Now, let’s have a quick look at the essence of the bullion market. In the bullion market, traders deal with precious metals like gold and silver. The trading takes place both in the counter market and in the exchange. The focus point of the page is the gold commodity under the bullion market. The entire detail regarding the gold price chart, analysis and usage is described here.
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Commodity Trading Medium in India
India has various regional as well as national commodity exchanges through which trading execution happens. Apart from the regional exchanges, there are six main national commodity exchanges. Multi Commodity Exchange (MCX), National Commodity and Derivative Exchange (NCDEX), National Multi Commodity Exchange (NMCE), Indian Commodity Exchange (ICEX), ACE, and UCX. Among these, the MCX or Multi-Commodity Exchange is the widely used trading platform for Gold. A large section of traders is engaged in the futures trading of Gold through MCX.
Gold as a Powerful Investment Avenue
From the ancient period, gold has been considered a precious metal. It has occupied a unique role not only in the Financial Market but also in Indian culture. The demand for Gold is continuously rising. However, the yellowish glowing metal is not magnetic (Chemical symbol Au). Since the beginning of civilisation, gold has been taken as a proxy for money and wealth. All over the world, the estimated supply of Gold is around 174,100 tonnes as per the GFMS gold survey report 2013. Besides its value, it is one of the most liquid assets in the world. In India, due to the huge demand for Gold, it can be assumed that the risk factor is low here. Therefore, in India, the value of gold is rising.
Usage of Gold
By describing the miscellaneous usage of gold, we will be able to understand the value as well as the demand for Gold properly. We are furnishing the usage of Gold below:
Jewellery
Each year, customers consume about 78% of gold as jewellery. This is the most common way to use gold, especially in India. Due to its look and value, it reaches most customers as a form of jewellery.
Finance and Investment
Now, come to the most significant category of usage of gold, through finance and investment options. Its rare availability increases its investment value to a certain level. Multiple investment options for gold are available in the financial market. For example, the Exchange Traded Fund, Equity-Based Gold Fund, the Physical form of Investment, and Future Trading.
Electronics
People can use gold as a highly efficient conductor in electronic devices. Hence, it can transfer tiny electrical charges to almost all electronic devices such as cell phones, GPS units, televisions, desktops, laptops, and many more.
Medicine
It carries not only conductor properties but also medicine properties. In dentistry, gold works wonderfully in making fillings, bridges, etc. It carries a non-allergenic property with it. Since 700 B.C., it has been used in dentistry and other medical fields.
Aerospace
Gold plays a significant role in the aerospace industry, too. The aerospace industry uses effective technology where they use gold to lubricate mechanical parts, conduct electricity, coat the insides of space vehicles, etc.
Reasons to Invest in Gold
- Its increasing Value is one of the main reasons to invest in gold. Due to its increasing value and rare availability, the investment can be hugely beneficial.
- Holds a reasonable value in comparison to reserve currency
- Works as a hedge during inflation. During inflation, gold performs as a hedge against inflation.
- During deflation, while other prices drop, the relative purchasing power of gold soars.
- The increasing demand for gold in jewellery, medicines, and electronics makes the value of gold high.
- Act as a financial protector in geographical and political uncertainty. In the present age of globalisation, there is no certainty of the geographical and political area. The gold reserve acts as a financial saver in the market.
Gold in the Indian Commodity Market
In the Indian Commodity Market, the future trading of Gold is quite popular among investors. I have mentioned earlier that MCX is the most popular exchange in the commodity market. A commodity-based futures contract is an agreement between two parties regarding a specific quantity based on a pre-fixed time and price. In simple words, the agreement contains a buy-sell amount of gold at a certain time and a price in the future. In future contracts, both buyers and sellers have an obligation to execute the trade.
Apart from future trading, intraday is also available in the gold market. Investors can make millions through intraday trading. Let us furnish the Gold Price Chart and Analysis below. Here, you can see the live gold price and gold price support and resistance. In order to trade profitably, traders must monitor the price movement pattern of gold regularly.
According to the gold price movements, the chart will update automatically. You need to refresh the page in order to see the update.
Here, we have taken the price of gold for 10 grams. The trading unit of gold is 1 KG. If the gold price is 29050 in the future, it suggests that 10 grams of gold cost 29050 Rs. A mini version of trade is also available in MCX, where traders can trade on 100 grams.
Traders can do their own analysis with a 1:2 risk-reward ratio, from which they can generate a good return. Pivot Point analysis or Opening Range Breakout analysis are popular for gold intraday trading. For positional trading, the SuperTrend indicator is significant.
Final Thoughts about Gold Price
However, these are the basics regarding the usage of gold in the Indian financial market. As it is one of the most liquid assets, there is always a high chance of getting a huge return from the gold investment. Traders can see the live update through the given chart.