Gold price today: Yellow metal trades flat with negative bias; Rs 46,900 crucial support

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India's gold futures for August were trading flat on the MCX with a negative bias on June 18 but experts say as long as the metal holds onto Rs 46,900, it still remains a buy-on-dips market.

International spot prices were steady as investors remained concerned about a possible slowdown in global economic recovery due to a rise in new coronavirus cases in the United States and China.

“Beijing canceled scores of flights, shut schools, and blocked off some neighbourhoods as it ramped up efforts to contain a coronavirus outbreak. The city confirmed 21 new COVID-19 cases as of June 17,” a Reuters report said.

On the Multi-Commodity Exchange, June gold contracts were trading lower by 0.11 percent at Rs 47,287 per 10 gram at 0930 hours. July futures for silver were trading 0.5 percent lower at Rs 48,200 per kg.

Gold and silver showed a mixed trend the previous day. Gold settled slightly negative at $1,735.60 per troy ounce while silver settled slightly positive at $17.77 per troy ounce in the international market.

At the MCX, the gold settled with the minor loss but held on to 47,300 levels. Silver settled with minor gains around 48,400 levels.

“Fear of a second wave of coronavirus and India and China tensions restricted gains in global equities and investors turned cautious again. India bans import of some of the Chinese goods and there is a possibility of escalation of a trade war between both the countries after the Galawan valley issue,” said Manoj Jain, Director (Head - Commodity & Currency Research) at Prithvi Finmart Pvt Ltd.

“We expect both the precious metals to remain volatile but they will continue to get support at lower levels. $1714 per troy ounce /Rs 46,900 will act as a major support for gold. If prices sustain above $1,733 per troy ounce /Rs 47,330 could extend the gains towards $1,745-1,755 per troy ounce /Rs 47,580-47,700 levels,” he said.

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Expert: Sriram Iyer, Senior Research Analyst at Reliance Securities

International bullion prices started flat on June 18 in Asian trade as markets await fresh triggers that may come in the form of jobless claims later in the day.

Markets also await the BoE meeting where the central bank could announce an increase of at least 100 billion pounds ($125 billion) in its bond-buying programme.

Technically, LBMA gold spot traded in a range of $1,712-$1,729, indicating some exhaustion above $1,730. However, it is trading and sustaining well above $1,710 levels, which signify that the bulls are active at these levels. Upside resistance holds at $1,733-$1,740 and support is placed at $1,715-$1,708 levels.

MCX Gold August contract bounced from support near 47,000 levels. It has given a positive close above 47,300, which signifies continuation of the uptrend. Support holds at 47,100-46,900 and resistance at 47,450-47,650 levels.

Expert: Ravindra Rao, VP- Head Commodity Research at Kotak Securities.

Comex gold was trading in a range near $1,735 after a 0.1% decline the previous day. Gold is steady as support from choppiness in the equity market is countered by gains in the US dollar. ETF investors have also moved to sidelines awaiting fresh cues.

Gold may continue to witness choppy trade as market players assess the possibility of re-imposition of sanctions in face of rising cases, however, the general bias may be on the upside unless risk sentiment improves significantly.

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