Gold and Silver Futures Market Update
Gold August futures and silver September futures contracts opened flat on Monday, with gold opening up by 0.27% or Rs 194 at Rs 73,184 per 10 grams and silver opening up by 0.03% or Rs 30 at Rs 89,676 per kilogram. The previous two trading sessions saw a notable decrease in gold prices by Rs 1,100 per 10 grams and silver by Rs 1,850 per kilogram.
Market Analysis and Insights
Both gold and silver settled on a weaker note in the international markets on Friday, which also reflected in domestic markets. Gold August futures contract settled at Rs 2,990 per 10 grams with a loss of 1.57% while the silver September futures contract settled at Rs 89,646 per kilogram with a loss of 2.32%.
The sell-off in gold and silver prices last week was a result of mixed U.S. economic data and a rebound in the dollar index. The uncertainty over Fed rate cuts in the September policy meetings was fueled by better-than-expected U.S. manufacturing activities data and the ECB’s decision to keep interest rates unchanged at 4.25%, which supported the dollar index.
Furthermore, safe-haven demand for the U.S. dollar increased amid uncertainty over the U.S. Presidential bid of Joe Biden following an assassination attempt on Donald Trump. However, a surge in U.S. jobless claims and a recovery in the Japanese Yen provided some support to precious metal prices.
Outlook and Recommendations
Manoj Kumar Jain of Prithvi Finmart Commodity Research highlighted that gold and silver prices are expected to remain volatile this week, particularly with the upcoming release of the U.S. core PCE price index data and the first look at the second quarter GDP data.
According to Jain, the support and resistance levels for gold and silver at mcx are as follows:
– Gold: Support at 72,650-72,300 and resistance at 73,330-73,700
– Silver: Support at 88,800-88,000 and resistance at 90,500-91,350
Jain advised caution and suggested staying away from trading gold and silver in the current session, especially with the Indian Union Budget scheduled for July 23rd. It is important to note that all recommendations, views, and opinions provided by experts in the field are their own and do not necessarily reflect the views of Economic Times.
