Amid the strong US dollar and possibility of higher for longer rates in the US, MCX for June futures contracts fell Rs 629 or 0.85% to trade at Rs 73,738 per 10 grams while MCX July silver contracts were down Rs 1,806 or 1.9% to Rs 93,461 per kg.
Gold is up 18% this year, boosted by central-bank purchases, strong demand from Asia, and geopolitical tensions, while silver reached 11-year highs before experiencing some profit-taking from their daily peaks.
Despite higher Treasury yields and hawkish comments from Federal Reserve officials, the belief that rates will be cut later this year continues to support gold prices.
Gold maintained its gains, trading at around $2,425 an ounce in early Asia hours after reaching a record $2,450.07 on Monday. This rise was driven by expectations of US rate cuts following a soft inflation report last week.
Today, the US Dollar Index, DXY, was hovering near the 104.67 mark, rising 0.11 or 0.10%.“The daily trading chart for gold is showing a bullish engulfing candlestick pattern, along with forming higher highs and higher lows, indicating a positive trend in its price. This optimism is further supported by gold bouncing back from its 21-day exponential moving average (EMA), which is acting as a support level. Moreover, a positive divergence in the Relative Strength Index (RSI) indicates growing market momentum,” said Neha Qureshi of Anand Rathi Commodities.It’s important to monitor potential resistance levels at 74,650 and 75,000. On the downside, support levels are positioned at 73,800 and 73,300, added Qureshi.Intraday Trading Strategy by Neha Qureshi:
– Buy MCX JUNE Gold futures at Rs 74400 with a stop loss of Rs 73800 and a price target of Rs 75000
– Buy MCX JULY Silver futures at Rs 95500 with a stop loss of Rs 92500 and a price target of Rs 98500
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