Bullion traded weak in the opening trade on Monday as Dollar Index (DXY) strengthened. It had fallen on Friday below the 103 mark as weaker-than-expected non-farm payroll data in the US enthused bullion as the yellow metal ended with sharp gains on Friday. The outlook for bullion is expected to remain sideways over this week and investors can find buying opportunities on dips.
DXY was trading at 102.46, up 0.19%.
The August gold futures were trading at Rs 58,705 per 10 grams on the MCX around 9:10 am and were down by Rs 77 or 0.13% from the Friday closing price. Meanwhile, September Silver futures were trading at Rs 71,131, lower by Rs 179 or 0.25%.
On the Comex, Gold futures were trading at $1,929.60 per troy ounce on Monday, down by $2.90 or 0.15% while Silver futures trading at $23.250, lower by $0.039 or 0.170%.
“Dollar Index corrected by 0.62% and closed at a 2 week low that helped gold gain 1.03% on the MCX. Silver futures increased by 3.27%. The trend in bullion is expected to remain sideways over this week so we are advocating buy on dips strategy in Gold and silver futures,” Anuj Gupta, Vice President (VP), Commodity and Currency Research at IIFL Securities said.
He sees support in August gold futures at Rs 58,400 and then Rs 57,800 while resistance at Rs 59,300 and then at Rs 59, 800. As for September Silver futures support is seen at Rs 69,500 – Rs 68,000 while resistance is at Rs 72,500 – Rs 74,000.
He expects gold to test Rs 60,000 per 10 gram and Silver futures to test Rs 72,500 – Rs 73,000 levels “very soon again”. The August gold futures ended with gains of Rs 391 per 10 grams or 0.67% at Rs 58,792 on Friday while the September silver futures finished up by Rs 1,009 per kg or 1.43% at Rs 71,333.Gold futures on the MCX have gained by 0.98% or Rs 571 per 10 gram on the month-to-date basis, Gupta said. They were up by 6.84% or Rs 3,765 on the year-to-date basis as on Friday, July 7 on the closing price basis, he added. Meanwhile, silver futures have gained nearly by Rs 1,280 or 1.83% in value terms in July while gaining by 2.73% or Rs 1,897 on the YTD basis, the IIFL analyst said.
Price of physical gold in bullion markets in Delhi-NCR is around Rs 60,200 per 10 grams, while that of silver is Rs 73,000 per kg, Gupta said.
Intraday trading strategy by Anuj Gupta
– Buy MCX August gold futures at Rs 58,200-58,400 with a stop loss of Rs 57,800 and price target of Rs 59,300
– Buy MCX September silver futures at Rs 70,000 with a stop loss of Rs 69,400 and price target of Rs 71,000.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)