A softer US dollar and lacklustre equity markets led to gains in gold and silver prices on Monday.
June gold futures were trading Rs 235 or 0.39% higher at Rs 60,564 per 10 grams on the MCX at 1:25 pm. Meanwhile, May silver futures were up by Rs 566 or 0.75% at Rs 75,472 per kg.
Gold futures hit a fresh lifetime high of Rs 61,371 on the MCX last week before closing the holiday-shortened week at Rs 60,329. With the current momentum, yellow metal futures are poised to touch levels of Rs 62,000 in April, suggest analysts.
On Comex, gold futures were trading at $2,026.50 per troy ounce, up by $10.70 or 0.53% while silver futures were trading at $25.690, down by $0.230 or 0.90%.
The dollar index trading in a narrow range is lending some support to gold, Emkay Wealth Management said in a note. “There is a feeling among some of the Fed officials that the stress in the banking system will only accelerate the arrival of the recessionary conditions earlier than expected. This will also keep gold fairly well supported. It may be stated that gold still retains its safe haven status and the recent events have had a positive impact due to this,” it said.
Emkay Wealth sees international gold testing $2100 level again and break through the same. Gold is currently trading in the range of $1960-2060/oz. It made two attempts in the last one month to break through the $2060 level, the note said further.
The year-to-date gains for MCX gold futures are at 9.88% or Rs 5,435 while the month-to-date gains are at 1.42% or Rs 845. Meanwhile, silver is approaching its all-time high of Rs 77,949 it hit in August 2020. The YTD gains are at 9.10% or Rs 6,317 while the MTD gains at 4.88% or Rs 3,525, Gupta said.Intraday Trading Strategy by Anuj Gupta of IIFL Securities
While spelling out the day’s trading strategy, Gupta advised investors with a near-term view to remain on the buying side. Correction is an opportunity to invest in bullion, he said. He sees gold prices hitting the Rs 62,000 mark in April.
- Buy MCX June Gold futures at Rs 60,100 with a stop loss of Rs 59,750 and price target of Rs 60,700
- Buy MCX May Silver futures at Rs 75,000 with a stop loss of Rs 74,350 and price target of Rs 76,200
“Gold prices sank in the last session by nearly 2% after hawkish comments from Fed officials regarding rate hikes dented precious metals sentiments. Comex Gold snapped its three-day winning streak and settled around $2003. The comments from the official offset the speculation that FED may pause hiking the interest rate that many investors and traders were betting on. The dollar index rebounded above the $102 level from one-year lows. Markets are currently pricing a 25 basis point rate hike from the Federal Reserve in May,” Deveya Gaglani, Research Analyst – Commodities at Axis Securities said.
In the Comex, a strong support zone is seen around the $1970 level and resistance is placed around $2050, Gaglani said.
“Gold may test the support at $1975. The next support is at $1950. Resistance is at $2020, followed by $2035,” Praveen Singh – Assistant Vice President, Fundamental Currencies and Commodities analyst at Sharekhan by BNP Paribas said.
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