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Gold Price Today Jumps Marginally; Silver Continues To Drop. Should you Invest?

·4-min read

Gold prices on Tuesday increased marginally. On the Multi-Commodity Exchange (MCX), gold futures increased 0.09% to Rs 48,565 for 10 grams at 1100 hours IST. However, silver continued to drop on June 15. July silver futures were trading 0.76 per cent lower at Rs 71,330 a kilogram.

In the international market, gold prices on Tuesday fell for a third straight day, as an uptick in the dollar dented the safe-haven metal’s appeal. Spot gold was down 0.1% at $1,864.82 per ounce, as of 0442 GMT, after falling to its lowest since May 17 at $1,843.99 on Monday. US gold futures eased 0.1% to $1,866.70, Reuters reported.

“International spot gold and silver prices have started weaker on Tuesday morning in Asian trade as speculators continued to remain away from the markets ahead of this week’s US Federal Reserve policy meeting. Technically, LBMA Gold Spot broke below its 21 Daily Moving Average at $1885 level and could remain weak to test $1852-$1844 levels. Resistance is at $1869-$1878 levels. LBMA Silver below $28.00 will continue its bearish momentum and could see further downside movement up to $27.20-$26.70 levels. Resistance is at $28.10-$28.55 levels,” said Sriram Iyer, senior research analyst at Reliance Securities.

Domestic gold and silver prices could start weaker on Tuesday morning, tracking overseas prices. On the domestic front, if MCX Gold August trades below 48500 levels we could witness a continuation of Bearish momentum up to Rs 48,350-48,000 levels. Resistance is at Rs 48,600-48,800 levels. MCX Silver July holds a support near Rs 71,100-70,500 levels. Resistance is at Rs 72,000-73,200 levels, Iyer added.

“One of the most important topics that market participants will focus upon is the forward action of the Federal Reserve as to whether or not they will begin to taper their massive asset purchases, which have now swelled their balance sheet to well over $7 trillion,” said said Amit Khare, AVP — research commodities, Ganganagar Commodities Limited

“Our technical studies indicate that major support for gold prices remains at $1845, which is based upon a combination of the 200-day moving average and the 61.8% Fibonacci retracement at $1844. The studies also indicate that resistance begins at $1900 to $1905, with major resistance at $1920, the highest trading level since this rally began at the end of March 2021 when a double bottom at $1692 was identified,” Khare added.

“The key outside markets today see the US dollar index a bit weaker. Nymex crude oil prices are up and trading around $71.25 a barrel after hitting a 2.5-year high of $71.70 overnight. The key US Treasury 10-year note yield is fetching around 1.5%.There was no major US economic data released Monday,” he further said.

“Bullion’s are showing some recovery on hourly technical chart, and price are going to open in negative territory as per comex current market price. So traders are advise to create long positions in gap down opening near support level and definitely traders should also focus important technical levels given below for the day: August gold closing price Rs 48,523, Support 1 – Rs 48100, Support 2 – Rs 47,800, Resistance 1 – Rs 48,900, Resistance 2 – Rs 49,250. July Silver closing price Rs 71,879, Support 1 – Rs 71,000, Support 2 – Rs 70,000, Resistance 1 – Rs 72,550, Resistance 2 – Rs 73,450,” he added.

“Gold prices opened sharply lower with a gap on Monday and fell further in the first half of the session till a low of Rs 48,105. However, prices did not sustain at lower levels and recovered strongly in the remaining session till a high of Rs 48,675,” ICICI Securities said.

“Prices corrected sharply in the last two sessions weighed down by a stronger dollar and easing concerns about inflation, while investors awaited cues from the US Federal Reserve’s policy meeting due later this week. Overall, we expect gold prices to consolidate in the range of Rs 48,100-48,900 in the short-term,” it said.

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