MCX Gold is expected to witness some short covering after this week steep sell off in domestic markets. Gold prices could rise next week if futures prices can hold support at important technical levels and if the U.S. dollar`s recent rally slows or falters. Market participants are keeping a close eye on two important factors in determining gold`s price near-term: physical demand and exchange-traded fund flows.
According to some sources, physical demand in Asia, most notably India and China, has been lighter than expected so far, given the sizable price break. For India, part of that is because gold priced in rupees has made the metal more costly than usual, but in the past day or so that cost has retreated slightly.
