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Gold prices were trading in the positive territory on Friday after the international spot gold hovered near a two and a half month high and was on track for its best week in five months. On MCX, gold June futures were trading Rs 90 or 0.19 per cent higher at Rs 47,685.50 per 10 grams, as against the previous close of Rs 47,595. Silver July futures were ruling at Rs 71,837 per kg, up Rs 156 or 0.22 per cent. Gold rallied and broke the narrow and defined trading range over the last 15 trading sessions between $1765 and $1798, said an analyst. “Gold had breached its major key psychological level of $1800 which prompted short-covering thus taking the price to $1820. What was more impressive is that not only prices sustained above $1800 but closed above its major resistance area of $1815,” Bhavik Patel, Senior Technical Research Analyst, Tradebulls Securities, told Financial Express Online.
Patel added that the two key factors which helped gold to soar above $1800 are weak USD and declining US Treasury yields. US Treasury yields dropped below 1.60 per cent and were hovering around 1.57 per cent. “The next major hurdle for gold will be for prices to push above their 200-day moving average, which currently comes in around $1,868,” Patel said. In MCX, gold has been trending higher after making a second more decisive upside move above Rs 47,500. Prices have been taking support around 50 day moving average (DMA) with the recent correction from Rs 48,420 to Rs 46,462 stopping at its 50 DMA. He further added that for the last six trading sessions, gold has been closing above its 20 DMA. Momentum remains upside with RSI_14 still at 60 thus outside overbought conditions.
Despite the upbeat US economic data, the dollar has refrained from strengthening. Traders still believe that the Fed will continue with its accommodative monetary policy stance, which has kept dollar index subdued and has worked out well for MCX gold prices, said Rahul Gupta, Head of Research-Currency at Emkay Global Financial Services. He told Financial Express Online that what matters to gold’s trajectory is tonight’s US NFP data. NFP is widely expected to reach 1 million after 916,000 jobs were added in March. “But even an upbeat data doesn’t really convince the market that the Fed will taper or raise rates sooner than expected, then we may see the uptrend in gold to continue towards 48500, while crucial support lies around 47250 and then 46350,” he said.
Globally, spot gold was steady at $1,815.88 per ounce, after hitting its highest since February 16, 2021, at $1,817.90 in the previous session. Bullion up more than 2.5% so far this week, according to Reuters. US gold futures were little changed at $1,816.40.
(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.)