NEW DELHI: Gold prices held in a tight range on Friday as investors stayed away from making big bets ahead of the US nonfarm payrolls data that could sway Federal Reserve’s monetary policy stance. The yellow metal showed mild gains in domestic markets.
US non-farm payrolls data, due later in the day, is expected to show an increase. Data on the number of Americans filing new claims for unemployment benefits fell more than expected last week.
The dollar held near three-month highs, making gold expensive for holders of other currencies. Some investors are betting that US government bond yields will continue to weaken in the second half of the year.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.3% to 1,043.16 tonne on Thursday.
Despite the recent price correction, retail gold demand in the world’s second largest consumer of physical gold has been weak. India has slashed the base import price of gold and silver, along with other commodities.
Gold futures on MCX were up 0.31 per cent, or Rs 146, at Rs 47,185 per 10 gram. Silver futures gained 0.24 per cent, or Rs 165, to Rs 69,285 per kg.
“COMEX gold trades marginally higher near $1,778/oz after a 0.3% gain yesterday. Gold has recovered from recent lows amid dip buying, renewed virus concerns and mixed economic data from major economies,” said Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities.
In the spot market, highest purity gold was sold at Rs 47,263, while silver was priced at Rs 69,160 on Thursday, according to the Indian Bullion and Jewellers Association.
“However, weighing on price is firmness in the US dollar amid Fed’s monetary tightening expectations, strength in equity markets and lack of investor buying. Gold has edged up amid some buying interest at the start of the new quarter and renewed virus concerns.”
Trading strategy
“We expect gold prices to trade sideways to up for the day with COMEX spot gold support at $1,760 and resistance at $1,800 per ounce. MCX Gold August support lies at Rs 46,700 and resistance at Rs 47,400 per 10 gram,” said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
Global markets
Spot gold was steady at $1,777.17 per ounce, as of 1251 GMT. It has fallen 0.2% so far this week. US gold futures rose 0.1% to $1,778.70.
Silver was little changed at $26.00 per ounce, while platinum was steady at $1,082.58. Both were down for the week. Palladium eased 0.1% to $2,761.69 but was set for a second straight weekly gain.