Gold, silver prices rally for 4th straight week; yellow metal set to report best monthly gains in 10 months

At MCX, Gold June costs have close to time period resistance at Rs. 49200 per 10 grams and assist at Rs. 48000 per 10 gram.

By Tapan Patel

Commodity costs traded greater throughout the week handed by with Bullion costs prolonged weekly good points after witnessing a minor correction in mid-week. Base metals advanced edged greater recovering from current lows on greater demand optimism. Crude oil costs rallied by greater than 4% following sturdy US financial information.

Gold costs traded greater with spot gold costs at COMEX rose by 1.20% to $1904 per ounce for the week. Gold costs at MCX gained by 0.29% to Rs. 48542 per 10 gram as sharp rupee appreciation restricted good points on the home market. The spot rupee rose by 0.55% in opposition to the greenback for the week reporting the fifth weekly acquire. Gold ETF holdings had been unchanged as holdings at SPDR Gold Shares had been at 1043 tonnes for the week. The CFTC information confirmed that cash managers elevated their web lengthy positions by 20007 tons in final week.

Silver costs edged greater with spot silver costs at COMEX ended 1.34% up at $27.94 per ounce for the week. MCX Silver Might futures rose by 0.79% to Rs. 71611 per KG. Silver costs outperformed gold throughout the week following sturdy shopping for in industrial metals. The gold/silver ratio has declined to 68 to this point after hitting document 130 ranges. The CFTC information confirmed that cash managers decreased their web lengthy positions by 1235 tons in final week.

Bullion costs traded greater with gold costs rallied for the fourth week on the trot after costs breached key psychological resistance at $1900 per ounce. The inflation worries had been the central level for this week’s bull within the valuable metals. Gold costs are set to report the perfect month-to-month good points in 10 months with rise of 8% within the month of Might. Bullion costs traded greater paring losses of the yr on greater inflation considerations with rise in private consumption expenditure and better PCE numbers. The greenback index ended firmly above 90 mark whereas US 10 yr treasury yields fell to 1.58% throughout the week. The dear metals will get assist from inflation hedge as central banks are nonetheless in dialogue on when to unwind the asset buy program which we anticipate will come no sooner on this yr.

We anticipate gold costs to commerce sideways to up within the coming week with COMEX spot gold resistance at $1940 per ounce and assist at $1860 per ounce. At MCX, Gold June costs have near-term resistance at Rs. 49200 per 10 grams and assist at Rs. 48000 per 10 gram. COMEX silver spot has near-term resistance at $28.90 per ounce with assist at $26.70 per ounce. MCX Silver July has essential resistance at Rs. 74400 per KG and assist at Rs. 69800 per KG.

(Tapan Patel is a Senior Analyst (Commodities) at HDFC securities. The views expressed are the writer’s personal. Please seek the advice of your monetary advisor earlier than investing.)