Gold prices in India traded flat on the Multi Commodity Exchange (MCX) Friday following a muted trend in the international spot prices amid a firm US dollar.
At 11:30 am, gold futures for August delivery eased 0.17 percent to Rs 48,316 per 10 grams as against the previous close of Rs 48,400 and the opening price of Rs 48,378 on the MCX. Silver futures traded 0.12 percent lower at Rs 69,600 per kg. The prices opened at Rs 69,906 as compared to the previous close of Rs 69,681 per kg.
“Gold prices are weighed down by a firm US dollar. We may see a short term correction in the precious metals, but the upside for the dollar looks limited in the long term, which will support the gold and silver prices. Hence, any drop in prices should be utilised as a buying opportunity,” said Amit Sajeja, VP Research - Commodities & Currencies, Motilal Oswal.
International gold prices were headed on Friday for a fourth straight weekly gain after the US Federal Reserve allayed investor fears of a faster tightening of monetary policy, though the safe-haven metal was subdued by pressure from a firmer dollar, said a Reuters report.
Spot gold was flat at $1,827.00 per ounce having hit a peak since June 16 at $1,833.65 on Thursday. Bullion gained 1.1 percent so far for the week. US gold futures were flat at $1,828.80.
According to Sajeja, silver prices may remain rangebound going ahead and gold will outperform silver.
“The bias for both the precious metals remains positive. Gold may test Rs $1,860 in the international market, while it may rise towards Rs 49,500 in the domestic market in the next couple of weeks,” Sajeja added.
Technically, gold is witnessing follow up buying during the day and trading near to its 100 DEMA level on basis Fed chair’s statement that rising inflation pressures are transitory.
“The yellow metal is entering into a seasonal demand period and will try to find fundamental support in a low interest scenario. Gold prices will find new momentum and speculative interest once it starts closing above $1,835 an ounce mark,” said Sandeep Matta, Founder, TRADEIT Investment Advisor.
“Gold on MCX is also trading positive and eyeing to cross Rs 48,500 level. The sentiments are bullish however we advise new entrants to wait for some correction before making a fresh entry. Existing market participants should trail their stop loss and/or must have some hedging against their buying position,” Matta added.
Making gold expensive for holders of other currencies, the dollar was headed for its best weekly gain in almost a month.
Meanwhile, recent strength in the Indian rupee amid buying in the local equity market weighed on the domestic precious metal prices.
“Technically one big profit booking is pending as per daily as well as an hourly chart. So traders are advised to create a short position in gold and silver near resistance levels. Traders should also focus on important technical levels for the day,” said Amit Khare, AVP- Research Commodities, Ganganagar Commodities.
August Gold: Support 1 – Rs 48,200, Support 2 – Rs 47,900; Resistance 1 – Rs 48,600, Resistance 2 – Rs 49,000.
September Silver: Support 1 – Rs 69,400, Support 2 – Rs 69,000; Resistance 1 – Rs 70,000, Resistance 2 – Rs 70,500.
Here are gold rates across major cities:
Here are silver rates across major cities:
(Disclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.)