Analysts believe that the trend of gold is positive on the back of weakness in the US dollar and lower bond yields.
Gold prices were trading higher in India on Thursday, due to a weaker US dollar. MCX gold June futures were trading Rs 77 or 0.16 per cent higher at Rs 47,077 per 10 gram, as against the previous close of Rs 47,000. Silver July futures were ruling at Rs 69,677 per kg, up Rs 58 on Multi Commodity Exchange. Silver futures ended at Rs 69,619 per kg in the previous session. On May 4, 2021, president Biden laid out his plan for the economy, first he proposed $2 trillion to upgrade US infrastructure, second stimulus of $1.8 trillion for US family plan for middle class, and thirdly, he announced an increase in tax rates. “These would weaken long term economic growth, thus gold prices are surging,” Rajesh Palviya, Head — Technical & Derivatives Research, Axis Securities Ltd, told Financial Express Online.
Palviya said that technically gold MCX June is range-bound between Rs 47,500 and Rs 46,500, and it may continue for a while. However, a break below Rs 46,500 would push prices towards Rs 45,500 per 10 gram, as the commodity is seen trading below its major resistance of 100 and 200 days SMA. “Alternatively, a break above 47500 would open doors towards the upside,” he said.
MCX gold has been witnessing volatility since it touched an all-time high of Rs 56,191 per 10 gram in August 2020. Analysts believe that the trend of gold is positive on the back of weakness in the US dollar and lower bond yields. However, increasing COVID-19 cases may support gold ETF demand. Central banks are also a net buyer in gold this year. “We are expecting it to rise further, traders may go for ‘buy’ in gold for the target of Rs 47,500 per 10 gram in near-term. We are recommending buy in gold for short term as well as long term,” Anuj Gupta, VP — Commodity and Currencies Research, IIFL Securities, told Financial Express Online.
Globally, gold prices inched lower on Thursday due to a stronger dollar, while investors awaited the release of US non-farm payroll data for April due later this week. Spot gold was down 0.1 per cent at $1,785.05 per ounce. US gold futures was steady at $1,785.10 per ounce.
Gold, silver intraday technical view
“Today, we expect the MCX Gold June price to trade sideways for intraday. Prices are trading below the key moving averages,” NS Ramaswamy, Head of Commodities, Ventura Securities told Financial Express Online. he added that The 20-day moving average is seen at 47,150 level. On the downside, key support level is seen at 46,600 level for intraday. If gold prices manage to break above Rs 47,150 per 10 gram in today’s session, then prices may head towards Rs 47,500 per 10 gram.
Ramaswamy said that MCX silver July prices were holding above the 20-day moving average which is now seen near Rs 68,400 per kg and is the key support for the prices. On the hourly chart, MCX Silver prices will face immediate resistance near Rs 70,000. Breaking above this level, prices are likely to head towards Rs 71,000 in today’s session, he added.
(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.)