Gold was trading lower in the Indian market on May 12 following muted trends in international spot prices as a rise in the US treasury yields and a firmer dollar dented the metal's safe-haven appeal.
On the Multi-Commodity Exchange (MCX), June gold contracts were trading lower by 0.65 percent at Rs 47,640 for 10 grams at 0935 hours. July silver futures were trading 0.47 percent higher at Rs 71,882 a kilogram.
The dollar index was up 0.1 percent, making gold more expensive for other currency holders. “The U.S. currency slipped to a more than two-month low in the previous session after worries about rising inflation threatened to erode its value,” a Reuters report said.
Gold and silver showed mixed trends in the international market on May 11 amid a rebound in the dollar index from their nine-week lows and an uptick in the 10-year benchmark bond yields in the United States. Both precious metals settled on a mixed note.
“Gold showed profit-taking from higher levels on Tuesday amid a rebound in the dollar index from their lows and gains in the 10-year bond yields,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart said.
“We expect weakness in the global equities and inflation fear could support precious metals at lower levels and gold is expected to hold its key support of $1,800 per troy ounce," he said. Gold has support at $1,822-1,800 and resistance at $1,850-1,866, Jain said.
On MCX, gold has support at Rs 47,330-47,180 and resistance at Rs 47,800-48,055. For silver, support is at Rs 71,400-70,900 and resistance at Rs 72,500-73,100. “We suggest buying in gold around 47,500 with a stop loss of 47,240 for the target of 48,000 and in silver around 71,400 with a stop loss of 70,700 for the target of 72,600,” added Jain.
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Expert - Sriram Iyer, Senior Research Analyst at Reliance Securities
International gold prices ended flat in volatile trading on May 11 as rising US treasury yields offset support from a weaker dollar and investors awaited US consumer price data to gauge inflation. Silver, on the other hand, ended higher probably tracking a weaker dollar.
Domestic gold ended weaker, tracking subdued overseas prices, while silver ended higher on a recovery in overseas prices.
Domestic gold and silver prices could start weak on May 12, tracking overseas prices.
Technically, MCX Gold June resistances are at 47700 and 47950. Supports are at 47450 and 47300.
Technically, MCX July silver resistances are at Rs 72,400 and Rs 73,100. Supports are at Rs 71,500 and Rs 70,800.Disclaimer
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