Indian Bullion Market
In India, the commodity market is full of opportunities and avenues. Commodity trading is an old professional path, dating back further than trading bonds, stocks. Nowadays, various avenues of commodity trading have been opened. Among this, 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 over the counter market as well as in exchange. The focus point of the page is the gold commodity under the bullion market. The entire detail regarding gold price chart and analysis, usage is described here.
Commodity Trading Medium in India
India has various regional as well as national commodity exchange through which trading execution happen. Apart from the regional exchanges, there is six main national commodity exchange. Multi Commodity Exchange (MCX), National Commodity and Derivative Exchange (NCDEX), National Multi Commodity Exchange (NMCE), Indian Commodity Exchange (ICEX), ACE and UCX. Among this MCX or Multi commodity exchange is the widely used trading platform for Gold. A large section of traders is engaged in the future trading of Gold through MCX.
Gold as a Powerful Investment Avenue
From the ancient period, gold is considered the precious metal. It has occupied a unique role not only in the Financial Market but also in the Indian culture. The demand for Gold is continuously rising. However, the yellowish glowing metal is not magnetic (Chemical symbol Au). Since the beginning of the civilization, Gold is taken as a proxy for money and wealth. All over the world, the estimated supply of Gold is around 174,100 tones 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 for gold is rising.
Usage of Gold
By describing the miscellaneous usage of gold, we will able to understand the value as well as the demand for Gold properly. Hence, the usage of Gold is described below:
Each year about 78% of gold is consumed by customers as jewelry. This is the most common way to use gold, especially in India. Due to its look and value, it reaches to most of the customers as a form of jewelry.
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 of gold are available in the financial market. For example, the Exchange Traded Fund, Equity-Based Gold Fund, the Physical form of Investment, Future Trading.
Gold can be used 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, desktop, laptop and many more.
It carries not only conductor properties but also medicine properties too. 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.
Gold plays a significant role in the aerospace industry too. Aerospace industry uses effective technology where gold can be used to lubricate mechanical parts, conduct electricity, coat the insides of the 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 to inflation.
- During deflation, while other prices drop, the relative purchasing power of gold soars.
- Increasing Demand for gold in jewelry, medicines, electronics makes the value of gold high.
- Act as a financial protector in the geographical and political uncertainty. At the present age of globalization, there is no certainty of the geographical and political area. Gold reserve acts as a financial saver in the market.
Gold in the Indian Commodity market
In Indian Commodity Market, the future trading of Gold is quite popular among investors. I have mentioned earlier that MCX is the most widely used exchange in the commodity market. A commodity-based future 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 price in the future. In future contract, both buyers and sellers have obligation to execute the trade.
Apart from future trading, intraday also available in the gold market. Investors can millions through the intraday trading. Gold Price Chart And Analysis is given below. Here, you can see the live gold price, gold price support-resistance. In order to trade profitably, traders must monitor the price movement pattern of gold regularly.
Gold Price Support And Resistance
Gold Futures daily Candlestick Chart
According to the gold price movements, the chart will update automatically. You need to refresh the page in order to see the update.
Here, the price of gold is taken for 10 grams. The trading unit of gold is 1 KG. If the gold price is 29050 in the future, it suggests 10 grams of gold cost 29050 Rs. A mini version of trade is also available in MCX, traders can trade on 100 grams.
Traders can do their own analysis with a 1:2 risk reward ratio, from where they can generate a good return. Pivot Point analysis or Opening Range Breakout analysis are popular for gold intraday trading. For Positional trading, Supertrend is significant.
However, these are the basics regarding 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.