Gold prices edged higher on September 27 as persistent concerns over the fate of debt-laden property giant China Evergrande and its broader impact bolstered the precious metal's safe-haven appeal. Prices rose above $1,750 as uncertainty over China's Evergrande saga boosted the safe-haven appeal of the precious metal. Spot gold rose 0.5% to $1,757.79 per ounce.
On the Multi-Commodity Exchange (MCX), October gold contracts were trading higher by 0.36 percent at Rs 46,162 for 10 grams at 0935 hours. September silver futures were up by 1.04 percent at Rs 60,578 a kilogram.
"COMEX gold trades modestly higher near $1758/oz after a 0.1% gain in previous session. Gold has benefitted from persisting worries about the Chinese economy amid concerns about debt default by the Evergrande Group and increasing regulatory crackdown measures. Choppiness in the US dollar has also lent some support," said Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities.
"However, weighing on price is Fed’s monetary tightening expectations and mixed ETF flows which show lack of investor confidence. Gold has managed to hold above $1740/oz level and with increasing challenges for the Chinese market, prices may remain supported," he added.
Trading Strategy
Manoj Kumar Jain, Director, Head-Commodity & Currency Research, Prithvifinmart Commodity Research
Gold and silver prices crashed last week after the US Federal Reserve gave a signal for raising interest rates from 2022 and also started tapering by the end of this year. The dollar index reached one month highs and benchmark 10-year bond yield crossed 1.45% levels again. Gold is trading at its make or break support level of $1750 per troy ounce and if it holds then it could rebound again, on the breakdown below $1750 could bring prices down to $1720-1700 levels.
We expect precious metal prices could find support at lower levels this week. Gold has support at $1740-1728, while resistance at $1762-1774 per troy ounce. Silver has support at $22.20-21.88, while resistance is at $22.80-23.00 per troy ounce. At MCX, gold is having support at 45800-45660 and resistance at 46240-46400; silver is having support at 59400-59100 and resistance at 60600-611100 levels. We suggest buying bold on dips around 45800 with a stop loss of 45580 for the target of 46220.
Manoj Dalmia, Founder and Director, Proficient Equities
Gold futures have fallen down by 2.54% in the last 1 week indicating poor demand. Currently, it has broken a trendline and is also halting near a support, we can expect a further fall in gold prices till the 44000 price zone as it seems to be good support.
Gold seems to have corrected by 18.27% from its all-time high of 56398 and can be seen as a good opportunity to accumulate on dips as we expect the gold prices to rise in the coming months amid the festive and wedding season.
Sandeep Matta, Founder, TRADEIT Investment Advisor
Gold is trading at critical support level after post FOMC event and is susceptible to lower pricing on various technical momentum indicators.
Gold on MCX is also following the US market trend, while the heavy selloff is unlikely the outlook is certainly negative. Participants who have strategic position are advised to hedge it while tactical positions must be align to key pivotal levels either side proactively during the day.
Key level for gold August contract – 45971
Buy zone above – 46000 for the target of 46135-47365
Sell zone below – 45975 for the target of 45850-46700
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
