India Gold MCX April futures trade higher on Monday but experts feel that it could face some resistance around 46,600 levels. Gold has recovered from recent lows, but ETF outflows and higher US and global bond yields, suggest experts.
On the Multi-Commodity Exchange (MCX), April gold contracts were trading higher by 0.23 percent at Rs 46,305 for 10 grams at 0920 hours. March silver futures were trading 0.56 percent higher at Rs 69,400 a kilogram.
Gold and silver showed huge volatility last week. Gold prices tested an eight-month low in the international markets and slipped below $1800 per troy ounce while silver prices also slipped below $27 per troy ounce at the start of the week.
Gold April futures contract settled at $1,783.35 per troy ounce, and silver March futures contract settled at $27.37 per troy ounce. The domestic markets also settled on a positive note.
The U.S. 10-year bond yield also cooled off on Friday and supported both the precious metals. Additionally, weakness in the dollar index and hope of U.S. stimulus is supporting precious metal prices in the international markets.
“We expect both the precious metals to remain volatile this week gold could face stiff resistance around $1800 per troy ounce while silver could show some strength again. Gold has support at $1770-1758, while resistance at $1800-1810 per troy ounce,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.
“At MCX, Gold has support around Rs 46000-45770 and resistance at Rs 46480-46620 and silver is having support at Rs 68200-67500 and resistance at Rs 69900-70700 levels. We suggest buying in the silver around Rs 68500 with the stop loss of Rs Rs 67800 on a closing basis for the target of Rs 70200,” he said.
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Sriram Iyer, Senior Research Analyst at Reliance Securities
International gold and silver prices recovered on Friday amid the covering of shorts and as the dollar index eased on Friday.
However, the upside was capped as the US 10-year benchmark continued to move higher.
On the speculative side of things, we saw that hedge funds and money managers slashed their bullish positions in COMEX gold by 22,269 contracts to 83,581 and raised them in silver contracts by 1,299 contracts to 40,990 in the week to Feb. 16, the U.S. Commodity Futures Trading Commission (CFTC) said.
Domestic gold and silver could trade with gains this Monday morning, tracking the overseas markets.
Technically, MCX Gold April could hold onto strong support at Rs 45800 levels and can bounce back up to Rs 46500-46800 levels. Support is at Rs 46080-45860 levels.
MCX Silver March took support near 50-Daily Moving Average which is placed at Rs 67690 levels indicating an upside momentum up to Rs 69300- Rs 70400 levels. Support is at Rs 68350-67600 levels.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities.
COMEX gold trades 0.4% higher near $1785/oz after a 0.1% gain on Friday. Gold has bounced back from June 2020 lows gaining support from the weaker US dollar, rising inflation expectations, hopes of additional US stimulus, and loose monetary policy stance of central banks.
However, weighing on price is continuing, however, the gains will be limited until US bond yields correct.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.