Gold was trading range bound in the early trade on Friday after a sharp fall in the previous session on the back of a strengthened dollar index (DXY) which is inching back to the 101 mark. It was hovering around 100.79 against a basket of 6 major currencies, though the bias was negative.
The August gold futures were trading flat at Rs 59,551 per 10 grams on the MCX though the bias was slightly negative. Meanwhile, September Silver futures were trading at Rs 75,513, up Rs 64 or 0.08%. Click to know more
Gold and silver futures ended in the red in the previous session. While gold ended 0.39% lower, silver futures fell 1.3%.
On the Comex, Gold futures were trading at $1,973.70 per troy ounce on Friday, up by $2.80 or 0.14% while Silver futures trading at $25.060, higher by $0.098 or 0.390%.
“Wider markets were not so supportive as commodities, in general, were lower on China’s demand concerns and a rebound in the US Dollar Index,” Praveen Singh, Associate Vice President, Fundamental Currencies and Commodities at Sharekhan by BNP Paribas said. “Gold is getting strong support from peak rate possibility, though the US Dollar Index may limit the gains,” he added.
This analyst opines that the fortune of gold depends “a lot on the yields”. “It is to be noted that a rate hike pause is not the same thing as a rate cut, though markets look forward to cuts as the next logical step by the key Central Banks,” he added.
“Bullions daily charts are now showing profit booking and trading in the overbought zone. Momentum Indicator RSI also indicating the same, so traders are advised to book profit in longs and can create fresh short positions in Gold and Silver near given resistance level one with the stop loss of resistance level two and book near given support levels,” Amit Khare, Associate Vice President at Ganganagar Commodity Limited (GCL) said.
Gold August futures have support at Rs 59,350 – Rs 59,200 and resistance at Rs 59,750 – 60,060. Meanwhile, Silver September futures have support at Rs 75,000 – Rs 74,500 and resistance at Rs 75,900 – Rs 77,000, Khare said.
Anuj Gupta, Vice President (VP), Commodity and Currency Research at IIFL Securities expects that DXY will further go down and test 97 levels adding that it would augur well for the yellow metal.
Gold futures on the MCX have gained by 2.37% or Rs 1,381 per 10 grams on a month-to-date basis. “They were up by 8.34% or Rs 4,584 on the year-to-date basis, he added. Meanwhile, Silver futures have gained nearly by Rs 5,405 or 7.72% in value terms in July while gaining by 8.73% or Rs 6,055 on the YTD basis,” the IIFL analyst said.
The price of physical gold in bullion markets in Delhi-NCR is around Rs 61,00 per 10 grams while that of Silver is Rs 77,500 per kg, Gupta said.
Intraday Trading Strategy by Anuj Gupta
– Buy MCX August Gold futures at Rs 59,300 with a stop loss of Rs 59,000 and a price target of Rs 59,800
– Buy MCX September Silver futures at Rs 75,000 with a stop loss of Rs 74,400 and a price target of Rs 76,000.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)