Gold prices for MCX August futures contracts opened at Rs 72,693 per 10 grams, gaining Rs 720 or 1% this week while MCX July future contracts for silver rose by Rs 2,300 or 2.6% in the same period, opening at Rs 91,420/kg.
Gold saw its biggest daily gain in five weeks, rising 1.4% on Thursday, driven by weak US economic data, which suggests the Federal Reserve might ease monetary policy this year.
The yellow metal hit its all-time high last month and is up 15% this year, supported by safe-haven purchases, central bank buying, and demand from Chinese consumers.
The rate cut speculation was fueled once again as the Swiss National Bank cut interest rates for the second straight time and the US data turned out to be weaker than expected across the board.
The Bank of England kept its rate unchanged at a 16-year high of 5.25% on Thursday while the People’s Bank of China kept the key rate steady, too.Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, mentioned it could take up to two years to reach the 2% inflation target but expressed confidence in achieving it. Today, the US Dollar Index, DXY, was hovering near the 105.57 mark, falling 0.01 or 0.01%.“On the daily timeframe, MCX Gold (August) is trading above its rising trend line and has formed a Bullish Engulfing candlestick pattern, indicating bullish sentiments. The price is currently above its 21 and 50 EMA, providing strong support and indicating continued strength. Key resistance levels to monitor are 72,900 and 73,300, while support levels are at 72,200 and 71,700,” said Neha Qureshi, Senior Technical & Derivative Analyst, Anand Rathi Commodities & Currencies.
Intraday trading strategy by Neha Qureshi:
- Buy MCX AUGUST Gold futures at Rs 72,600 with a stop loss of Rs 72,200 and a price target of Rs 73.200
- Buy MCX JULY Silver futures at Rs 91,600 with a stop loss of Rs 90,600 and a price target of Rs 93,600
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