Gold fell on Thursday led by steady dollar amid concerns of inflation and likelihood of further interest rate hike by the US Federal Reserve. At 104.86, the dollar index (DXY) was hovering just shy of 105 against a basket of six major currencies which lent weakness to the yellow metal. It was also the greenback’s six month high levels.
The MCX October gold futures were trading down by Rs 71 or 0.12% from the Wednesday closing price at Rs 59,017 per 10 gram on the MCX while the December Silver futures were trading at Rs 72,214 per kg, lower by Rs 258 or 0.36%.
On Comex, Gold futures were trading at $1,950 per troy ounce on Thursday, down by $1.70 or 0.09% while Silver futures closed at $23.765, higher by $0.108 or 0.450%.
The October Gold futures had ended with losses of Rs 156 or 0.26% per 10 gram at Rs 59,087 on Wednesday while the December Silver futures closed lower at Rs 72,465, down by Rs 980 per kg or 1.33%.
“Gold is in danger of falling further on increased probability of a rate hike by the US Federal Reserve later this year. Slower corporate bond issuance may temper yields, which may support the yellow metal,” Praveen Singh, Associate Vice President, Fundamental Currencies and Commodities at Sharekhan by BNP Paribas said. Singh sees support at $1,915/$1,900/$1,885 while resistance at $1,932-$1,955.
Amit Khare Associate Vice President at Ganganagar Commodity Limited (GCL) Broking sees weakness in bullion on the daily charts with momentum indicator RSI also indicating the same.
He is recommending traders to make fresh short positions in gold and silver near resistance levels of Rs 59,300 – Rs 59,600 while booking profit near the support levels. As for December Silver futures, support is seen at Rs 72,000 – Rs 71,500 and resistance at Rs 72,800 – Rs 73,600, Khare said.
Neha Qureshi, Senior Technical & Derivative Analyst, Anand Rathi Commodities & Currencies also sees weakness in gold arguing that gold prices were above the 50-day and 100-day EMA, which are like support levels.
“If they’re crossed, it could mean the market is turning bearish. For potential prices, there’s a tough point around 59,600 and 60,000, and if it goes down, it might find support at around 58,800 and 58,400,” she added.
Gold futures are down 0.48% or by Rs 286 on the month-to-date basis while they have gained 7.40% or by Rs 4,071 on the year-to-date basis, Anuj Gupta, Head Commodity & Currency at HDFC Securities told ETMarkets.
As for Silver futures, the declines are to the tune of 4.24% or Rs 3,210 in September while the gains this year stand at 4.41% or Rs 3,059, he said.
The physical price of gold in top Indian cities like Delhi and Ahmedabad is around Rs 60,300 per 10 gram while Rs 75,000 for silver.
Intraday Trading Strategy by Anuj Gupta
– Sell MCX October Gold futures at Rs 59,300 with a stop loss of Rs 58,800 and a price target of Rs 58,950.
– Sell MCX December Silver futures at Rs 73,300 with a stop loss of Rs 74,100 and a price target of Rs 71,800.
Intraday Trading Strategy by Neha Qureshi
– Sell MCX October Gold futures at Rs 59,150 with a stop loss of Rs 59,350 and a price target of Rs 58,800.
– Sell MCX December Silver futures at Rs 72,600 with a stop loss of Rs 73,600 and a price target of Rs 70,600.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)