Gold traded lacklustre while silver was up with mild gains in early trade in the domestic futures trade on September 17 in light of weak global cues.
In the previous session, gold and silver prices fell after upbeat US economic data and strength in the dollar index.
The dollar traded near three-week highs, denting the appeal of gold as a safe-haven asset after the economic data in the US showed healthy economic revival.
Apart from global cues, strong gains in riskier equities also weighed on gold prices. Market benchmark the Sensex hit a fresh record high of 59,582.36 in the early deals.
On MCX, October gold was trading 0.03 percent lower at Rs 46,064 per 10 gram at 0940 hours but December Silver was 0.27 percent up at Rs 61,239 per kg.
"Gold and silver prices crashed on September 16. Gold prices hit a four-week low and silver prices hit a five-week low. Stronger than expected US economic data supported the dollar index and triggered selling in both the precious metals," Manoj Kumar Jain, Director, Head-Commodity & Currency Research, Prithvifinmart Commodity Research, pointed out.
Technical indicators
Expert: Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities
Weighing on gold is upbeat US economic data which strengthened the case for Fed’s monetary tightening. However, supporting price is rising inflation concerns, persisting virus risks, concerns about the health of the Chinese economy and increased geopolitical tensions.
ETF inflows also showed some buying interest at lower levels however the pace was modest. Gold's sharp fall has dented market sentiment however we believe that market reaction to US data was exaggerated and price may stabilize near the $1,750/oz level.
Amit Khare, AVP- Research Commodities, Ganganagar Commodities Limited
Now, both metals are trading in an oversold zone which means any time we can see a good short-covering rally in bullion.
Momentum indicator RSI also indicating the same, so positional traders are advised to create fresh buy positions especially in gold in small dips near Rs 45,900-45,700. Traders should focus on important technical levels given below for the day:
October gold support 1: Rs 45,750 | Support 2: Rs 45,450 | Resistance 1: Rs 46,400 | Resistance 2: Rs 46,700.
December silver support 1: Rs 60,200 | Support 2: Rs 69,400 | Resistance 1: Rs 62,000 | Resistance 2: Rs 62,750.
Sandeep Matta, Founder, TRADEIT Investment Advisor
The safe-haven metal has fallen into the danger zone and could anytime break the Rs 45,000 level if the levels of $1,745/oz in the US are not respected.
Key level for gold: Rs 46,268
Buy zone: Above Rs 46,275 for the target of Rs 46,400-46,550
Sell zone: Below Rs 46,250 for the target of Rs 45,800-45,600
Manoj Dalmia, Founder and Director, Proficient equities Private limited
The overall trend is weak for now. $1,750 is a very crucial support for gold.
Buy zone: Rs 46,100 for the target of Rs 46,700-46,800
Sell zone: Below Rs 45,700 for the target of Rs 45,400-45,200
Manoj Kumar Jain, Director, Head-Commodity & Currency Research, Prithvifinmart Commodity Research
We expect both the precious metals to remain volatile in today’s session and could show some price retracement from lower levels.
Gold is having support at $1,745-1,720 per troy ounce and resistance at $1,772-1,784 per troy ounce; silver is having support at $22.55-22.30 per troy ounce and resistance at $23-23.40 per troy ounce.
On MCX, gold is having support at Rs 45,800-45,550 and resistance at Rs 46,330-46,600; silver is having support at Rs 60,500-59,900 and resistance at Rs 61,800-62,400 levels. We suggest buying silver around Rs 61,000 with a strict stop loss of Rs 60,600 for the target of Rs 61,800.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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