Gold price fell in Asia on Thursday as investors braced for a U.S. jobs report expected to set the timing for the Federal Reserve to hike interest rates...
Gold price fell in Asia on Thursday as investors braced for a U.S. jobs report expected to set the timing for the Federal Reserve to hike interest rates this year as widely expected, while news of a nuclear deal with Iran was being assessed. U.S. markets are shut on Friday, but data on non-farm payrolls will be released. Investors focused on Friday’s U.S. employment report, which was forecast to show a gain of 245,000 jobs in March, following an increase of 295,000 in February.
On domestic front, Gold bullion purchases across Asia slowed this week as a long rally in prices discouraged buyers with traders keeping a close watch on top consumer India ahead of Akshaya Tritiya that usually sparks strong demand for the metal on a softer dollar and caution from the Federal Reserve over US interest rate hikes. The softness in demand comes ahead of April’s Akshaya Tritaya festival, when it is considered auspicious to buy gold. Apart from sustained festival season buying by jewellers, a firming trend in global markets as geo-political tension in Middle-East boosted demand for the precious metal as a safe-haven, helped gold to trade above the Rs 27,000-mark.
Crude oil fell the last session while was extending its losses on Tuesday as markets continue to talk about the finalization of the deal between Iran and Western countries over its co called nuclear program. On late Thursday, details emerged that Iran and Western powers had reached a deal on the framework of a preliminary Iranian nuclear pact before a final agreement could be reached in late-June.
“This framework would cut off the pathway Iran could take to develop a nuclear weapon,” U.S. president Barack Obama said at a news conference outside the White House. “This deal is not based on trust, it is based on unprecedented verification.”
Copper prices were little changed on Thursday, as market players looked ahead to the release of key U.S. employment data for further indications on the strength of the economy and the future path of monetary policy. Futures were likely to find support at $2.709, the low from April 1, and resistance at $2.792, the high from March 30. Official data on Wednesday showed that China’s manufacturing purchasing managers’ index inched up to 50.1 this month, while the China HSBC (LONDON:) final manufacturing PMI was revised up to 49.6 in March.
Over all, MCX Gold June future is in consolidation and sustaining in range from the last week. For the coming week 26300/25800 will act as a major support whereas 28000/28500 will act as a major resistance level in MCX Gold June future. For the next week in MCX Gold, traders can use sell on higher level strategy, if MCX Gold June future sustains above the levels of 27000 then it could test the levels 27500/28000.
Technically, MCX Silver May future is in consolidation and sustaining on higher levels. So for the coming week 41500/43000 will act as a major resistance levels where as 38000/36600 will act as major support in MCX Silver May futures. For the next week in MCX Silver futures, traders can use sell on higher level strategy, if MCX Silver May futures sustains above 38000 then it could test the levels of 39000/40200. For this week, major U.S. data ISM non manufacturing PMI, FOMC meeting minutes and Unemployment claim. Home sales coupled with physical demand in Asian region will further provide direction to the bullions. Further progress in the quantitative easing by U. S. government will also provide base for the market movement.
By Vivek Gupta, CMT – Director Research, CapitalVia Global Research Ltd.