India Gold MCX August futures trade flat-to-higher on Wednesday. Investors across the globe look forward to the outcome of the U.S. Federal Reserve meeting for hints on tapering of economic support measures, said a Reuters report.
The dollar held steady near a one-month high against its rivals, making gold more expensive for holders of other currencies, added the report.
On the Multi-Commodity Exchange (MCX), August gold contracts were trading higher by 0.13 percent at Rs 48,488 for 10 grams at 0930 hours. July silver futures were trading 0.40 percent higher at Rs 71,535 a kilogram.
Gold and silver plunged ahead of the U.S. Federal Reserve meeting outcome later on Wednesday. Both the precious metal settled on a weaker note in the international markets.
Gold August futures contract settled at $1856.40 per troy ounce and Silver July futures contract settled at $27.69 per troy ounce. Both the precious metals settled on a weaker note in the domestic markets as well.
The dollar index traded steady ahead of the U.S. Federal Reserve policy meeting outcomes while benchmark 10-year bond yield climbed again and crossed 1.50% during the session, said a Prithvifinmart Commodity Research report.
“We expect both the precious metals to remain volatile in Wednesday’s session and gold prices are at a make or break levels. If it breaks its crucial support of $1850 per troy ounce, it could show further weakness in the upcoming sessions,” Manoj Kumar Jain, Director, Head-Commodity & Currency Research, Prithvifinmart Commodity Research said.
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“We expect gold to hold its support levels on a closing basis. Gold has support at $1850-1834 per troy ounce and resistance at $1868-1884 per troy ounce. At MCX, Gold has support at 48180-48000 and resistance at 48660-48880,” he said.
Jain suggests buying in gold on dips around 48200 with a stop loss of 47950 for the target of 48660 and in silver around 70700 with a stop loss of 70200 for the target of 71800.
Technical indicatorsRavindra Rao, CMT, EPAT, VP- Head Commodity Research, Kotak Securities
COMEX gold trades little changed near $1856/oz after a 0.5% decline yesterday. Gold has turned range-bound as market players’ position for Fed decision.
Gold has already corrected in the expectation that Fed may hint toward monetary tightening and further movement may come from actual stance. ETF investors have also moved to the sidelines.
Sriram Iyer, Senior Research Analyst at Reliance Securities
International spot gold prices declined on Tuesday for a third-straight session decline.
International spot silver prices too tracked gold and declined on Tuesday. Domestic gold and silver ended in the red on Tuesday, tracking overseas prices.
Domestic gold and silver prices could start weaker on Wednesday morning, tracking overseas prices.
On the domestic front, MCX Gold August below 48500 levels could see a Bearish momentum where further could take 48350-48100 levels. Resistance is at 48600-48800 levels.
MCX Silver July holds support near 70800-69900 levels. Resistance is at 72000-73100 levels.
Abhshek Chauhan, Head Commodity & Currency, Swastika Investmart Ltd
We expect gold prices to face selling pressure from higher levels in case of any tapering news came from the US Fed, especially now with inflation at 4%.
We expect Gold prices to trade in the range of 48900-48000 for the next few days. Selling pressure likely to remain at higher levels.
Amit Khare, AVP- Research Commodities, Ganganagar Commodities Limited
Gold and Silver are showing some profit booking on daily as well as a weekly technical chart. Traders are advised to create short positions near resistance levels and traders should also focus on important technical levels given below for the day:
August Gold closing price 48,424: Support 1 - 48200, Support 2 - 48000, Resistance 1 - 48750, Resistance 2 - 48950
July Silver closing price 71,248: Support 1 - 70700, Support 2 - 70000, Resistance 1 - 71800, Resistance 2 – 72300Disclaimer
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