Gold and silver prices edged lower in the Indian market on Tuesday tracking the overseas prices. On Multi-Commodity Exchange (MCX), the gold futures declined by 0.26% to Rs 48,429 for 10 grams at 10.50 am on May 25. Silver futures were down by 0.67% to Rs 71,330 for a kilogram.
In the international market, gold prices fell on Tuesday as risk appetite improved after US Federal Reserve officials calmed down inflation worries among investors. Spot gold slid 0.3% to $1,876.24 per ounce by 0250 GMT. US gold futures fell 0.4% to $1,876.30 per ounce, according to Reuters. The dollar was languishing near four-month lows against major currencies, while US Treasury long-dated yields fell to two-week lows.
“International spot gold and silver prices have started marginally weaker this Tuesday morning in Asian trade as hopes of quick economic recovery lifted demand for riskier assets. Although a weaker dollar and lower US Treasury yields limited losses for prices. Technically, LBMA Gold Spot chart suggests sideways price action where $1868 and $1854 are supports, while resistances are at $1881 and $1893. Technically, if LBMA Silver trades above $27.20 level we could witness a continuation of its bullish momentum up to $28.05-$29.00 levels. Supports are at $27.00 and $26.20,” said Sriram Iyer, senior research analyst at Reliance Securities.
“Domestic gold and silver prices could start flat to marginally weaker this Tuesday morning. Technically, MCX Gold June could remain range bound. Resistances are at Rs 48,650 and Rs 48,800. Supports are at Rs 48,370 and 48,200. Technically, if MCX Silver July sustains above Rs 71,000 levels, we could witness the price test the resistances zones at Rs 72,100 and Rs 73,000. However, a trade below Rs 71,000 could pull prices to the supports at Rs 70,500 and further down to Rs 69,900,” Iyer added.
“The market forces and events which have taken gold to higher pricing since the end of March are still dominantly in play. The two primary forces are dollar weakness and data indicating an uptick in inflation. These two factors greatly affect treasury yields and in turn treasury yields affect bullish or bearish sentiment in gold. Recently the US Labor Department showed that the consumer price index jumped to 4.2% in April. It is up 2.6% from the numbers revealed in March,” said Amit Khare, AVP- research commodities, Ganganagar Commodities Limited.
“Our technical studies indicate that there is solid support for gold between $1849 (the current fix of the 200-day moving average), and $1851 the 61.8% Fibonacci retracement,” he added.
“We can see some correction in both precious metals today, So traders are advise to take the advantages of correction and go long in down prices. traders also focus important technical levels given below: June Gold closing price Rs 48,553, Support 1 – Rs 48,350, Support 2 – Rs 48,100, Resistance 1 – Rs 48,710, Resistance 2 – Rs 48,920. July Silver closing price 71,811, Support 1 – Rs 71,100, Support 2 – Rs 70,500, Resistance 1 – Rs 72,320, Resistance 2 – Rs 73,200,” the analyst added.
“Prices remained supported in the last few sessions as the dollar held near its weakest since late February, with investor focus turning to key economic readings from the US this week. Overall, we expect gold prices to rise further towards Rs 49,000 level in the short-term,” said ICICI Securities in a note.