Gold October futures contracts at MCX opened flat today at Rs 70,679 per 10 gram, which is down by 0.08% or Rs 59 while silver September futures contracts were trading at Rs 81,237/kg, down by 0.47% or Rs 387.
The prices of gold have gained Rs 800/10 gm while silver has gained Rs 700 per kilogram in the last 2 days.
Gold remained steady near record levels as traders considered the possibility of rising tensions in the Middle East and awaited a key US inflation report that could influence the Federal Reserve’s decision on interest rates.
The price of gold was around $2,470 an ounce during Asian trading hours after rising 1.7% on Monday. This increase was driven by safe-haven demand amid fears that Iran might attack Israel, potentially leading to a larger regional conflict.
Markets are also focused on upcoming US inflation data, which could provide insight into whether the Federal Reserve can manage inflation without causing a recession. The Consumer Price Index (CPI) report, due on Wednesday, is expected to show a slight increase in prices for July, but at a slower annual rate.Today, the US Dollar Index, DXY, was hovering near the 103.12 mark, falling 0.02 or 0.02%.“If inflation eases, it could strengthen the case for the Fed to lower interest rates, which would be positive for gold since lower rates make gold more attractive as it doesn’t pay interest. Gold has gained 20% this year, helped by expectations of rate cuts, strong purchases by central banks, and high demand from Chinese consumers. The metal’s appeal as a safe-haven asset has also been bolstered by rising geopolitical risks and the upcoming US election,” said Neha Qureshi Senior Technical & Derivative Analyst, Anand Rathi Commodities & Currencies.Qureshi states that on the daily chart, MCX Gold October futures have rebounded from a rising trendline support, forming a series of higher highs and higher lows, which signifies a bullish trend. A bullish engulfing candlestick pattern has emerged, further indicating positive market sentiment. The price is currently trading above its 21-day EMA, reinforcing a bullish outlook. Additionally, the RSI is showing a positive divergence, suggesting the potential for further upward movement. The resistance levels are around 71,300 and 71,900, while support levels are at 70,200 and 69,700.
Intraday Trading Strategy by Neha Qureshi
- Buy MCX October gold futures at Rs 70600 with a stop loss of Rs 70200 and a price target of Rs 71300
- Buy MCX September silver futures at Rs 81500 with a stop loss of Rs 80500 and a price target of Rs 83500
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)