On Tuesday, gold prices traded flat to negative after international prices strengthened the dollar, and comments by US Federal Reserve Chairman Jerome Powell about the economy influenced the yellow metal’s appeal as a safe haven. MCX gold futures for June traded down 34 rupees to 47,285 rupees per 10 grams, up from the previous close at 47,319 rupees. Silver futures for July traded at Rs 70,738 per kg, down Rs 162 or 0.23 percent. In the previous session, silver futures ended at Rs 70,900 per kg. Globally, spot gold fell 0.2% to $ 1,789.02 an ounce. The metal peaked since February 25 at $ 1,797.75 on Monday. US gold futures fell 0.2% to $ 1,788.80 an ounce, according to Reuters.
Bhavik Patel, Senior Technical Research Analyst, Tradebulls Securities
Gold futures showed strong and respectable gains yesterday, with the COMEX contract up $ 25 and the MCX, despite the strong rupee, up nearly Rs 400 from yesterday’s opening. The factor that contributed to yesterday’s gains was a weak US dollar and a slightly lower yield on US Treasuries. IHS Markit US manufacturing activity below expectations pushed the dollar down. Yellen’s inflation forecast helped keep the bond yield cap on, as she believes the massive infrastructure program will not affect inflation as the program will extend over the next ten years. This has helped to shift some of the sentiment from the bond market to the gold market, which is why we are seeing renewed demand for gold.
Although gold prices have failed to rise above $ 1,800 an ounce, I am still optimistic that this level will eventually be broken. Key macro data for gold is due out this Friday, that is, the US employment report for April. Hedge funds are increasing their bearish rates as gold cannot get past the $ 1,800 level, but we believe this will change when gold hits above $ 1,800. On the MCX, we still recommend buying on dips of around Rs 47,000 with an expected target of Rs 47,700 and a stop loss of Rs 46,500. Short-term support for gold is Rs 46,450 and any upward momentum will only shift if gold closes below that level.
N.S. Ramaswami, Head of Commodities, Ventura Securities
Today we expect the June price of MCX Gold to be positive throughout the day. It closed sharply above the 20-day moving average yesterday and is likely to cross above the 100-day moving average today. On the hourly chart, MCX GOLD prices closed above key averages, which will drive prices up further. Once prices start trading above the 47,500 level, prices are likely to cross the 48,000 level. On the other hand, 46,800 pips will be a key support for the price. On the Comex, the gold price will face strong resistance at $ 1,800 an ounce, and after breaking it, the next stage of the rally will head towards $ 1,850 an ounce in the coming sessions.
July prices for MCX SILVER look optimistic throughout the day. The RSI indicator on the daily chart has moved into the positive zone, which indicates a strong growth momentum. After breaking the recent high of 71,500 levels, we can see that prices will head towards 74,000 levels in the coming trading sessions. On the other hand, the 20-day moving average will be key support, which is now seen at 69,000. On the Comex Front, silver will face a strong obstacle zone at $ 27.00 per ounce at its daily close and break through the next stage of the rally will advance to the levels of $ 27.50-28 an ounce in the coming trading sessions.
Ravindra Rao, CMT, EPAT, Vice President, Head of Commodity Research at Kotak Securities
Gold trading on the COMEX remained almost unchanged at $ 1,790 an ounce after rising 1.4% yesterday. Gold has stalled after failing to overcome the $ 1,800 per ounce level and the volatility of the US dollar. The US currency fell yesterday on disappointing data and cautious comments from Fed officials, but rose slightly today, supported by general US optimism. Supported by rising virus infections and loose monetary policies by major central banks, among other factors, weaker investor interest and concerns over Indian demand have been countered by weaker investor interest and concerns. Volatility in the US dollar as market participants assess the Fed’s monetary policy stance may remain volatile in gold, but overall bias may be positive as central banks may remain calm.
Jigar Trivedi, Basic Research Analyst, Anand Rathi Shares and Stock Brokers
MCX Gold hit more than a two-month high in the previous session after ISM PMI research showed that the US manufacturing sector expanded at a slower pace in April due to slower growth in both new orders and employment. Gold has already rallied amid lower US Treasury yields and growing concerns over the coronavirus crisis. The average daily rate of new COVID-19 cases worldwide has exceeded 800,000 for over a week, with India reporting over 300,000 new cases for the 12th straight day. Investors await a lot of US economic data this week, including data on non-farm employment. Silver MCX in July also soared above Rs. 70,000. Expectations of increased industrial demand as the economic recovery accelerates and the dollar weakened, provided long-term support. As the yellow metal rose sharply in the previous session, it may experience a slight correction, but the tone is positive and we recommend going long on every dip. Silver is also gaining momentum due to rising industrial demand and we remain bullish on silver.
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