Gold, silver halt weekly price declines; bullions may trade trade sideways to down this week

October 04, 2021 10:03 AM

We expect gold prices to trade sideways to down in coming week with COMEX spot gold resistance at $1790 per ounce and support at $1730 per ounce.

Gold priceGold and silver price expected to trade sideways this week. (Image: REUTERS)

By Tapan Patel

Commodity prices traded mixed with bullion prices witnessed recovery for the week halting weekly declines. Crude oil prices extended gains on lower supplies and higher demand on costly alternate fuels. Base metals traded weak pressured by demand worries from China over power shortage and government restictions. 

Gold prices traded higher with spot gold prices at COMEX ended 0.60% up to $1761 per ounce for the week. Gold December futures at MCX rose by 0.63% near Rs. 46286 per 10 gram along with rupee depreciation. The spot rupee ended 0.85% lower against the dollar for the week. Gold ETF holdings witnessed outflows as holdings at SPDR Gold Shares declined to 986.5 tonnes from previous week’s 993 tonnes. The CFTC data showed that money managers decreased their net long positions by 19471 lots in last week.

Silver prices traded higher with spot silver prices at COMEX ended half a percent up at $22.54 per ounce for the week. MCX Silver December futures rose by nearly 1% to Rs. 60550 per KG for the week. Silver prices capped upside with decline in base metals on China demand worries. The CFTC data showed that money managers increased their net long positions by 2618 lots in last week.

Bullion prices witnessed strong recovery from recent lows during the week ended in green halting the series of weekly declines. The precious metals were trading down in the start of the week with gold traded near $1730 per ounce on increased expectations of US FED tapering. Bullion prices recovered in the second half of the week supported by fall in US bond yields despite of stronger dollar. The additional support came from inflation worries with rising gas and coal prices which may result into higher input cost for the manufacturers or possible shut downs. The dollar index rose by 0.76% to 94.04 for the week while US 10 year treasury yields fell to 1.46% during the week. Silver prices at COMEX recovered from strong support levels of $21.50 in line with gold prices. Gold prices need to break above $1800 to resume uptrend. 

We expect gold prices to trade sideways to down in coming week with COMEX spot gold resistance at $1790 per ounce and support at $1730 per ounce. At MCX, Gold December prices have near term resistance at Rs. 46700 per 10 grams and support at Rs. 45800 per 10 gram. COMEX silver spot has near term resistance at $23.60 per ounce with support at $21.50 per ounce. MCX Silver December has important resistance at Rs. 63000 per KG and support at Rs. 58000 per KG.

(Tapan Patel is a Senior Analyst (Commodities) at HDFC securities. Views expressed are the author’s own. Please consult your financial advisor before investing.)

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Skyrocketing LNG prices inflate industrial costs, consumers to bear the brunt
2Gold imports jump multi-fold to $24 bn in Apr-Sep
3Sri Lanka seeks $500 mn loan from India for fuel purchase