Gold was trading flat in the Indian market on August 26, tracking muted tread in international spot prices as investors turned cautious a day ahead of US Federal Reserve chairman Jerome Powell’s speech at Fed's annual symposium at Jackson Hole.
On the Multi-Commodity Exchange (MCX), October gold contracts rose marginally by 0.02 percent at Rs 47,188 for 10 grams at 0930 hours. September silver futures were trading 0.13 percent lower at Rs 63,192 a kilogram.
On August 25, gold slipped Rs 262 to Rs 47,448 per 10 gram amid increased risk appetite, dollar uptick and negative global cues.
Investors’ focus is now on the Federal Reserve’s direction on asset tapering and interest rate hikes.
"Gold and silver plunged on Wednesday amid improving risk appetite and record gains in US equity markets. Traders are having a close watch on this week’s Jackson Hole symposium in which Fed Chairman Jerome Powell will speak on Friday,” said Manoj Kumar Jain, Director, Head-Commodity & Currency Research, Prithvifinmart Commodity Research.
Many traders and investors think that the Federal Reserve will decide to extend its easy-money policies for a longer period than they had reckoned a few weeks ago, due to the rapidly spreading Delta variant of the coronavirus, Kumar said.
"Weakness in the dollar index supported both precious metals at lower levels. We expect both precious metals to remain volatile in today’s session ahead of the Jackson Hole symposium and could find support at lower levels,” he said.
Gold has support at $1,784-1,768 a troy ounce and resistance at $1,800-1,818. For silver, support is at $23.55-23.20 a troy ounce and resistance at $24-24.40 per troy ounce, he said.
"At MCX, gold is having support at 47,050-46,800 and resistance at 47,330-47,600 levels; silver is having support at 62,900-62,500 and resistance at 63,600-64,100 levels. We suggest buying in silver around 62,900 with a stop loss of 62,500 for the target of 64,100," Jain added.
Technical indicators
Ravindra Rao,CMT, EPAT, VP- Head Commodity Research at Kotak Securities
Comex gold was trading near $1,790 after a declining 1 percent the previous day. Gold was trading unchanged as gains in the dollar were countered by choppiness in equities as market players positioned the Jackson Hole symposium.
Support from virus risks, global growth worries and geopolitical tensions were countered by weaker investor interest.
Gold may remain sideways ahead of the Fed chairman's comments, however, global uncertainty may support prices.
Sriram Iyer, Senior Research Analyst, Reliance Securities
International spot and futures gold prices ended weaker on August 25 despite weaker dollar ahead of the Jackson Hole symposium.
International spot silver prices ended marginally higher, while futures on Comex ended in the red.
Tracking overseas markets, domestic gold and silver too, ended lower.
Ahead of Powell’s speech, investors remain divided over whether they will get a roadmap on when the US central bank may start trimming its bond-buying programme and if the chairman will tone down the Fed's hawkish tone, in turn helping gold.
Technically, LBMA gold below $1,795 level could see some sideways to marginal downside momentum up to $1,786-$1,770. Resistance is at $1,805-$1,820.
On the domestic front, MCX October gold could see sideways momentum where support is at 47,050-46,800 and resistance at 47,250-47,350 levels.
MCX September silver above 63,500 could see 64,000-64,900 levels. Support is at 63,000-62,400. MCXBULLDEX May could trade on a bullish note within the 14,050-14,300 range.
Amit Khare, AVP- Research Commodities, Ganganagar Commodities
Gold and silver prices were lower in midday trading on August 25 but up from the session lows on some routine profit-taking and downside corrections after recent gains.
Better risk appetite recently is also a bearish element for the safe-haven metals. October gold futures were last down $16.30 at $1,790. September Comex silver was last down $0.104 at $23.79.
Gold and silver are making a bottom and the momentum indicator RSI is creating a strong positive divergence in silver in daily as well as the four-hourly chart. Any dip is an opportunity to create fresh long positions in bullion.
Traders should create fresh buy positions in gold and silver near given support levels, traders should also focus on important technical levels given below for the day:
August gold closing price: Rs 47,179 | support 1-46,950 | support 2-46,700 | resistance 1-47,400 and resistance 2 -47,700.
September Silver closing price: Rs 63272 | support 1- 62,850 | support 2-62,400 | resistance 1-63,660 | resistance 2-64,230.
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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