Gold traded in the green on Wednesday amid weakness in the dollar index (DXY), as it attempted to regain some lost ground after a sharp Tuesday fall. Indication of a soft landing for the US economy by the country’s Central Bank lifted the DXY.
The DXY was still trading above the 102 mark against a basket of top six currencies, though the bias was negative leading to an uptick in gold and silver future prices.
The October gold futures were trading with declines at Rs 59,540 per 10 grams on the MCX, up Rs 152 or 0.26%. Meanwhile, September Silver futures were trading at Rs 74,217, up Rs 274 or 0.37%. Click to know more
MCX gold ended down 1.12% on Tuesday, while silver futures fell 1.93% or Rs 1,457.
On the Comex, Gold futures were trading at $1,984.90 per troy ounce on Wednesday, up $6.10 or 0.31% while Silver futures trading at $24.490, up $0.164 or 0.67%.
“Gold is expected to be volatile as bonds trade amid thin liquidity. The upcoming US ISM non-manufacturing and nonfarm payroll report for July will be crucial for the metal,” Praveen Singh – Associate Vice President, Fundamental Currencies and Commodities at Sharekhan said, commenting on the day’s outlook.
“Rating agency Fitch’s downgrade of the US government’s credit rating is supportive to the cause of the gold in the near term,” he added. He sees support at $1,935 – $1,900 while resistance is seen at $1,965 – $1,975.On the technical aspects, Amit Khare Associate Vice President at Ganganagar Commodity Limited (GCL) Broking sees bullion daily charts to be attractive with the potential for upside movement in the near future. “Momentum Indicator RSI also indicates the same so traders are advised to make fresh buy positions in Gold and Silver near given support level with the stop loss at the support level while booking profit near the resistance,” Khare said.
He sees support at Rs 58,850 – Rs 58,500 and resistance at Rs 59,150 – Rs 59,300.
“Gold futures on the MCX have declined by 0.57% or Rs 344 per 10 grams on a month-to-date basis. They were up 7.80% or Rs 4,322 on the year-to-date (YTD) basis,” market expert Anuj Gupta said.
“Meanwhile, Silver futures have lost nearly Rs 1,484 or 1.97% in value terms on the first trading session in August while gaining 6.53% or Rs 4,530 on the YTD basis,” he added.
The price of physical gold in bullion markets in Delhi-NCR is around Rs 60,700 per 10 grams while that of Silver is Rs 75,900 per kg, Gupta said.
Intraday Trading Strategy by Anuj Gupta
– Buy MCX October Gold futures at Rs 59,000 with a stop loss of Rs 58,700 and a price target of Rs 59,600
– Buy MCX September Silver futures at Rs 72,800 with a stop loss of Rs 72,000 and a price target of Rs 74,000.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)