Gold Prices Today: Yellow metal under pressure as Fed minutes hint 'restrictive' monetary policy

Gold, Gold prices, yellow metal, Precious metals

Gold extended its selloff to an over nine-month low on Wednesday in the international markets hurt by a stronger dollar, while the Federal Reserve's June meeting minutes established a more "restrictive" monetary policy.

At 9.34am, gold contracts were trading higher by 0.26 percent at Rs 50,631 for 10 grams on the Multi-Commodity Exchange (MCX) while silver gained 0.62 percent to Rs 57,075 a kilogram.

Gold and silver prices extended losses yesterday as the US dollar index advanced 0.65 percent. US benchmark treasury yield also gained 3 percent, putting pressure on precious metals. From the US macro front, Jolts job opening and Service PMI stood better than forecasted earlier amid rising interest rate scenario accelerating bearish sentiment in bullion prices.

Investors are staying away from bullion as a sharp fall in prices of industrial and agricultural commodities raises the hope of easing inflation in the upcoming days. Selling pressure in the precious metals may remain intact. Gold has resistance at Rs 51000 and support at Rs 50000. Silver has support at Rs 56000 and resistance at Rs 58400, said Nirpendra Yadav, Senior Commodity Research Analyst at Swastika Investmart.

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Tapan Patel, Senior Analyst (Commodities), HDFC Securities

Gold prices traded firm on Thursday with COMEX Spot gold prices were trading 0.38 percent up near $1745 per ounce in the morning trade. Gold prices pared some previous loses on weaker dollar after falling to 10 month lows. The Fed speculation and dollar movement is dominating bullion prices to trade weak. The US Fed reiterated to home interest rates hinting real danger of high inflation.

We expect gold prices to trade sideways to down for the day with COMEX Spot gold support at $1720 and resistance at $1760 per ounce. MCX Gold August support lies at Rs 50200 and resistance at Rs 51000 per 10 grams.

Rahul Kalantri, VP Commodities, Mehta Equities

Bullions ended mixed in the international market on Wednesday, with gold August futures contract ending at $1,736.50 per troy ounce, down by 1.55% while silver September futures contract gaining 0.20 percent to end at $19.16 per troy ounce. However, strength in the rupee saw bullion prices end lower in the domestic market.

Gold extended its selloff to an over nine-month low, hurt by a stronger dollar, while the Federal Reserve's June meeting minutes established a more "restrictive" monetary policy. The gold market remains sharply lower, testing long-term support above $1,730 an ounce. Silver is also trading near two-year lows.

We expect both precious metals to remain volatile in today’s session and some short covering is expected at lower levels. Gold has support at $1730-1717, while resistance is at $1752-1764. Silver has support at $19.05-18.80, while resistance is at $19.40-19.62. In rupee terms gold has support at Rs 50,350–50,120, while resistance is at Rs 50,820–51,040. Silver has support at Rs 56,150-55,650, while resistance is at Rs 57,480–57,810.

Ravi Singh - Vice President and Head of Research - ShareIndia

Gold prices are witnessing indecisiveness on account of growth worries, geopolitical uncertainty, spiralling inflation, stronger dollar and bond yields. Investors are not able to decide whether to buy on dips or short on highs. The indecisiveness in gold may remain for sometime till any fresh trigger breaks the range. In the meantime, gold may remain under selling pressure this week.

Buy zone above Rs 50700 for target of Rs 51000
Sell zone below Rs 50300 for target of Rs 50000

Amit Khare, AVP- Research Commodities, Ganganagar Commodity

Gold and silver showed negative movement on July 6. On the Multi-Commodity Exchange (MCX), August gold contracts closed down by 1.59 percent at Rs 50,500 for 10 grams. While September contract Silver futures closed at Rs 56,726 a kilogram, 0.24 percent down. As per technical chart gold and silver are trading at oversold zone and any time we can see a good pullback rally in bullions. Momentum indicator RSI is also indicating the same on the hourly as well as daily chart. So traders are advised to create fresh buy positions near given support levels in bullions, traders should focus important technical levels.

August gold closing price Rs 50500, Support 1 - Rs 50300, Support 2 - Rs 49900, Resistance 1 - Rs 50800, Resistance 2 - Rs 51100.

September silver closing price Rs 56726, Support 1 - Rs 56500, Support 2 - Rs 56000, Resistance 1 - Rs 57000, Resistance 2 - Rs 57500.

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