Gold August futures opened lower by 0.72%, or Rs 534, at Rs 73,621 per 10 grams on Friday, while silver September futures contracts opened down by nearly 1%, or Rs 90,953 per kilogram.
The yellow metal has traded flat, gaining only Rs 340 per 10 grams in the last week, while silver has dipped by Rs 2,100 per kilogram in the same period.
Gold is currently seeing some profit-taking, but things look positive in the medium-term amid political uncertainty and as rate cuts approach, Kelvin Wong, OANDA’s senior market analyst for Asia Pacific told Reuters.
Today’s decline in gold prices marks the longest streak of daily drops since May. This follows a recent peak that some investors deemed too high. Nevertheless, gold is poised for its fourth consecutive weekly gain, buoyed by expectations of prompt and substantial monetary easing by the Federal Reserve.
Gold and silver extended their decline in international markets after the IMF executive board advised the US to delay interest rate cuts until late 2024. The IMF also suggested increasing tax rates to mitigate the Federal Reserve’s growing debts.
A rise in US jobless claims supports predictions of a Fed rate cut in September. Gold remains nearly 20% higher for the year, fueled by central bank purchases, strong demand in China, and its status as a haven amid geopolitical tensions.
On Friday, the US Dollar Index, DXY, was hovering near the 104.23 mark, falling 0.06 or 0.05%.
“On the daily chart, MCX Gold August futures is not able to sustain above 74800 and has formed an inverted hammer candlestick pattern followed by a bearish candlestick pattern indicating bearish sentiment. RSI is showing a negative divergence indicating weakness. The key resistance levels are around 74,731 and 75,200, while the support levels are approximately 73,530 and 73,068,” said Neha Qureshi Senior Technical & Derivative Analyst, Anand Rathi Commodities & Currencies.
Intraday Trading Strategy by Neha QureshiSell MCX August gold futures at Rs 74,100, with a stop loss of Rs 74,800 and a price target of Rs 73,000
Sell MCX September silver futures at Rs 92,000, with a stop loss of Rs 93,000 and a price target of Rs 90,000
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)