Gold October futures contracts as well as silver December futures contracts at MCX opened flat today after the US Fed cut the interest rates by 50 bps. The former stood at Rs 72,916 per 10 gram, which is down by 0.19% or Rs 139 while the latter stood at Rs 88,375/kg, up by merely 0.09% or Rs 76.
However, the prices of gold have fallen by Rs 600 per 10 grams in this week so far while silver prices have dipped by Rs 800/kg.
On Wednesday, gold and silver settled on a weaker note in the domestic market while in the international market, they settled on a mixed note. Gold October futures contract settled at Rs73,055 per 10 grams with a loss of 0.05% and silver December futures contract settled at Rs88,299 per kilogram with a loss of 0.94%.
Gold and silver were trading in a tight range in the early trading session and gained after hefty 50 basis points rate cuts by the U.S. Fed in its monetary policy meetings but were unable to hold gains after the FOMC press conference. The Fed funds rates are now in the range of 4.75%-5.00%.
“I don’t see anything in the economy that suggests that the likelihood of a downturn is elevated. Inflation is easing but unemployment is rising more than Fed’s expectations level and cause of concern for the U.S. Fed,” said Jerome Powell, Fed Chairman.
Today, the US Dollar Index, DXY, was hovering near the 101.07 mark, rising 0.47 or 0.47%.“The dollar index also rebounded despite hefty rate cuts by the U.S. Fed and limited gains of precious metals. We expect gold and silver prices to remain volatile this week ahead of the Bank of Japan’s policy meetings but expected to hold its support level of $2,522 and $29.50 per troy ounce respectively on a weekly closing basis,” Manoj Kumar Jain of Prithcifinmart Commodity Research
Range for gold and silver by Manoj Kumar Jain:
- At mcx, gold is having support at 72,800-72,550 and resistance at 73,300-73,620.
- Silver has support at 87,700-87,000 and resistance at 89,000-89,650.
“We suggest selling gold below 73000 with a stop loss of 73300 for the target of 72400,” Jain added.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)