Gold price today, 20 May 2021: Gold trades flat on rise in US Treasury yield, US dollar; may touch Rs 49,200

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May 20, 2021 9:58 AM

Gold Rate Today, Gold Price in India on 20 May 2021: Gold prices were trading lower in India on Thursday, as international spot prices were flat and hovering a more than four-month high, on a firmer dollar and rise in US Treasury yields.

Gold Rate Today, Gold Price Today in IndiaGold MCX June has breached its horizontal trend line resistance at 48400 and closed well above it yesterday nevertheless, it is near its major resistance at 200 day SMA which is at 49000 zones, said an analyst. Image: Reuters

Gold Price Today, Gold Price Outlook, Gold Price Forecast: Gold prices were trading lower in India on Thursday, as international spot prices were flat and hovering a more than four-month high, on a firmer dollar and rise in US Treasury yields. On Multi Commodity Exchange, gold June futures were trading Rs 150 or 0.31 per cent down at Rs 48,524 per 10 gram. In the previous session, it ended at Rs 48,674. Silver July futures were also trading weak, down Rs 300 or 0.41 per cent at Rs 72,076 per kg, as against the previous close of Rs 72,374 per kg. Globally, spot gold was flat at $1,869.50 per ounce, after hitting its highest since January 8, 2021 at $1,889.75 on Wednesday. US gold futures fell 0.7 per cent to $1,869.20 per ounce. Minutes from the US Federal Reserve’s last monetary policy meeting, revealed that higher interest rates increase the opportunity cost of holding bullion. The dollar index bounced off from a near three-month low, while benchmark US Treasury yields rose to a one-week high after the Fed minutes, according to Reuters.

Rajesh Palviya is Vice President– Research (Head Technical & Derivatives) at Axis Securities Limited

The Dollar Index is continuously trading on the lower side with US 10-year Treasury yield is under 1.65 levels. If today’s US Data i.e., Manufacturing index and jobless claim show positive signs then, gold may see some range bound moment in short term. Else, advancement could resume. Technically speaking, Gold MCX June has breached its horizontal trend line resistance at 48400 and closed well above it yesterday nevertheless, it is near its major resistance at 200 day SMA which is at 49000 zones. Hence, expect some selling pressure at those levels. Therefore, it is likely that prices may continue to trade in a range between 48400 and 49000 levels; a break above 49000 indicates bulls taking charge, this would lead prices towards 52000 and higher zones. Alternatively, a fall below 48400 would push prices towards 48000.

Bhavik Patel, Senior Technical Research Analyst, Tradebulls Securities

Gold recovered smartly yesterday on account of two factors. First was reversal of money flows where big institution players were exiting crypto currencies and turning to gold. The massive selloff in Bitcoin came after China said that virtual currencies could not be used as a form of payment. Gold was the only asset standing tall yesterday in the sea of red as stocks, commodities (Base metals and energy pack), and cryptocurrencies plunged. The second reason was the minutes published from the FOMC which stated that although numbers of participants were open to discuss a plan for adjusting the pace of asset purchases, the Fed chairman stated that the Fed would stay the course until the economy strengthened even further and coronavirus cases fell sharply. So in the short term there is no risk for interest getting raised which also boosted gold prices. Gold upside momentum is expected to continue till it is above $1850 in COMEX which also represents 200 day moving average. Looking at the strong rally yesterday, we believe gold will see some sideways movement going forward and expect Rs 49,000-49,200 levels to be tested on the higher side soon. Buy on dips should be the strategy this week with long positions to be taken around Rs 48,000 with stoploss of Rs 47,800.

Ravindra Rao, CMT, EPAT, VP — Head Commodity Research, Kotak Securities Ltd

COMEX gold trades 0.4% lower near $1873/oz after a 0.7% gain yesterday when it tested the highest level since early Jan. Gold came under pressure as FOMC minutes noted that discussions over tapering of bond purchases have begun even as the central bank continues with an accommodative stance. ETF outflows also show profit taking by investors. However, supporting price is choppiness in the financial market amid inflation concerns and concerns about China’s commodity purchases. Gold rallied sharply in last few days however lack of any positive trigger from FOMC minutes may make it vulnerable to some profit taking.

(The views in this story are expressed by the respective experts of research and brokerage firm. Financial Express Online does not bear any responsibility for their advice. Please consult your investment advisor before investing.)

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