Gold prices edged up in early trade in the domestic futures market on positive global cues. Yellow metal prices moved higher in international markets after the US dollar softened ahead of the Federal Reserve’s policy decision. The latest US inflation data boosted hopes for a pause in rate hikes by the Fed which will be positive for gold.
“US consumer price index rose 4 per cent in May, its smallest annual increase in more than two years, but stayed well above the Fed’s 2 per cent target. In the 12 months through May, core CPI climbed 5.3 per cent, showing that underlying price pressures remained strong,” reported Reuters.
MCX Gold August futures traded 0.18 per cent higher at ₹59,324 per 10 gram around 10:30 am.
What should you do?
Gold prices are expected to trade slightly volatile ahead of the US Fed outcome.
Manoj Kumar Jain of Prithvifinmart Commodity Research expects gold and silver to hold their key support levels of $1,934 per troy ounce and $23.50 per troy ounce respectively this week and prices to remain highly volatile due to FOMC meeting outcomes and volatility in the dollar index.
“Gold has support at $1,945-1934, and resistance at $1,970-1,984 per troy ounce. Silver has support at $23.55-23.35, and resistance is at $24.10-24.35 per troy ounce,” said Jain.
“At MCX, gold is having support at ₹59,000- ₹58,770 and resistance at ₹59,480- ₹59,700 while silver is having support at ₹71,650- ₹71,100 and resistance at ₹72,700- ₹73,200. We suggest buying silver on dips around ₹71,600 with a stop loss of ₹70,990 for the target of ₹72,700,” Jain said.
Rahul Kalantri, VP of Commodities at Mehta Equities expects gold and silver to remain volatile in today’s session.
“Gold has support at $1936-1,928 while resistance is at $1,957-1,965. Silver has support at $23.70-23.55, while resistance is at $24.10-24.25. In the Indian rupee terms, gold has support at ₹59,050- ₹58,870, while resistance is at ₹59,450- ₹59,640. Silver has support at ₹71,480- ₹70,920, while resistance is at ₹72,640– ₹73,120,” said Kalantri.
Brokerage firm ICICI direct expects spot gold to hold the support near $1,930 levels and rise back to $1,960 levels on a weak dollar amid rising bets that the US Federal Reserve will hold rates unchanged at its much-awaited policy decision due today.
“MCX Gold prices are likely to move north towards ₹59,600 as long as they trade above ₹59,000 levels. MCX Silver is expected to follow gold and rise towards ₹72,500 as long as it stays above ₹71,700 level,” said ICICI direct.
Brokerage firm SMC Global Securities believes gold may trade in the range of ₹58,900- ₹59,400.
