Gold falls by Rs 1,284 at Rs 71,522/10 gm, silver at Rs 81,189/kg

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Gold prices on MCX for June futures contracts fell by Rs 1,284 or 1.7% to trade at Rs 71,522 per 10 grams while MCX May silver contracts were down by Rs 2,318 or 2.7% to Rs 81,189 per kg.

On Friday, gold June futures contract settled at Rs72,806 per 10 grams while silver May futures contract settled at Rs 83,507 per kilogram. Precious metals have pulled back after a streak of highs in the previous weeks.

Taking cues from the international markets, gold prices fell on dollar uptick, which hovered above the 106 mark. At 6:30 pm IST, the dollar index was trading at 106.24, up by 0.08 points or 0.08%.

“Gold’s price decreased slightly due to reduced geopolitical tensions in the Middle East, which diminished its appeal as a safe investment. Despite ongoing conflicts between Israel and Iran, the situation seems to be stabilizing as both sides downplay the severity of recent strikes. Investors are now shifting their focus to upcoming US economic data, specifically the personal consumption expenditures price index, which could influence Federal Reserve decisions on interest rates,” states Neha Qureshi, senior technical & derivative analyst of Anand Rathi Commodities & Currencies.

Higher interest rates generally make gold less attractive since it does not yield interest. Despite these factors, adds Neha, gold’s price remains significantly higher this year due to strong demand from central banks and buyers in Asia, particularly China.

In the US markets, gold slid $59 or 2.4% to $2,354.80 per troy ounce.On the daily chart, as per Qureshi, the June gold futures have formed a bearish engulfing candlestick pattern not able to sustain above 73,300 which is a strong resistance zone suggesting a potential downturn. The Relative Strength Index (RSI) has entered the overbought territory and is displaying negative divergences, which supports the bearish outlook. The key resistance levels to watch are at 73,300 and 73,958, while the support levels are situated at 72,300 and 72,020.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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