MUMBAI (Reuters) - Gold futures in India are likely to ease further from their highest level in a week hit on Monday on renewed strength in dollar, which has hurt the yellow metal's appeal as an alternative investment.
The euro fell to a two-week low against the dollar on Tuesday after weak German data fanned concerns about the euro zone economy and speculation the European Central Bank could cut interest rates.
"Stronger dollar would weigh on precious metals and mostly silver will suffer from the base metal weakness as well," said Gnanasekar Thiagarajan, director of Commtrendz Research.
The actively traded gold for June delivery on the Multi Commodity Exchange (MCX) was 98 rupees lower at 26,265 rupees per 10 grams at :10 pm, after hitting a high of 26,542 rupees on Monday, a level last seen on April 15.
Selling is advised in June gold on rallies to 26,250-26,300, with a stop loss of 26,575, targeting 25,700, said Thiagarajan.
However, rising physical demand from India, the world's biggest buyer of the metal, could limit the downside.
Akshaya Tritiya will be celebrated next month, a time considered auspicious to buy gold. Also, the wedding season continues until July.
Silver for May delivery on the MCX was 595 rupees lower at 43,092 rupees per kilogram.
Selling is advised in silver on rallies to 43,150-43,200, with a stop loss of 43,600, targeting 41,700, said Thiagarajan.
(Reporting by Siddesh Mayenkar; Editing by Jijo Jacob)
