Gold prices in India traded higher on the Multi Commodity Exchange (MCX) Wednesday tracking a positive momentum in the international spot prices after US Federal Reserve pledged not to increased interest rates quickly, analysts said.
At 12:25 pm, gold futures for August delivery rose 0.15 percent to Rs 47,080 per 10 grams as against the previous close of Rs 47,011 and the opening price of Rs 47,093 on the MCX. Silver futures traded 0.30 percent higher at Rs 67,720 per kg. The prices opened at Rs 67,917 as compared to the previous close of Rs 67,515 per kg.
“Fed chairman again reiterated that transitory inflation has been higher and more persistent than expected, however, they will likely wane. Technically the gold price will remain in the congestion zone until it crosses $1,800 mark,” said Sandeep Matta, Founder, TRADEIT Investment Advisor.
On MCX, gold was able to manage Rs 47,000 level and again expected to remain in range. Traders will find movement in both the side and is a market for skilled traders, he added.
International gold prices rose on Wednesday after US Federal Reserve Chair Jerome Powell pledged to keep interest rates near zero for some time, although gains were capped by a slight uptick in the dollar as investors waited for further clarity on inflation, said a Reuters report.
Powell on Tuesday reaffirmed the US central bank’s intent to encourage a “broad and inclusive” recovery of the job market.
Gold tends to appreciate on expectations of lower interest rates, which reduce the opportunity cost of holding non-yielding bullion.
Spot gold was up 0.2 percent at $1,781.18 per ounce. US gold futures gained 0.2 percent at $1,781.30 per ounce.
Benchmark 10-year Treasuries yields inched lower after Powell’s Congressional testimony.
The dollar index rose 0.1 percent in the session against its rivals, making gold more expensive for holders of other currencies.
“Gold and Silver are showing recovery on daily and looking for short covering, Momentum indicator RSI is also giving some positive clues. So traders are advised to go for long in gold and silver and should also focus important technical levels given below for the day,” said Amit Khare, AVP- Research Commodities, Ganganagar Commodities.
August Gold: Support 1 – Rs 46,750, Support 2 – Rs 46,500; Resistance 1 – Rs 47,250, Resistance 2 – Rs 47,500.
July Silver: Support 1 – Rs 67,000, Support 2 – Rs 66,500; Resistance 1 – Rs 68,100, Resistance 2 – Rs 68,720.
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