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Gold, silver under pressure as dollar strengthens; expect bullion prices to trade sideways this week

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Gold priceAt MCX, Gold August costs have close to time period resistance at Rs 49,700 per 10 grams and assist at Rs 48,200 per 10 gram.
(Picture: REUTERS)

By Tapan Patel

Commodity costs traded blended with many of the commodities within the Non-Agro phase traded agency besides gold. Crude oil costs prolonged rally on sturdy gasoline demand restoration type US and Europe. Base metals led to inexperienced as China continued to extend costs discarding inflation worries. Bullion costs traded underneath strain on stronger greenback following sturdy financial information.

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Gold costs traded decrease with spot gold costs at COMEX fell by 0.74% to $1877 per ounce for the week. Gold costs at MCX led to inexperienced by 0.64% at Rs 48,903 per 10 gram supported by rupee depreciation. The spot rupee fell by 0.10% in opposition to the greenback for the week extending weekly declines. Gold ETF holdings witnessed inflows as holdings at SPDR Gold Shares rose to 1045 tonnes from 1043 tonnes for the week. The CFTC information confirmed that cash managers decreased their internet lengthy positions by 2782 heaps in final week.

Silver costs led to inexperienced with spot silver costs at COMEX rose by 0.45% at $27.92 per ounce for the week. MCX Silver July futures ended up by 0.96% to Rs 72,227 per KG. Silver costs witnessed some assist following shopping for on industrial metals. The CFTC information confirmed that cash managers elevated their internet lengthy positions by 1855 heaps in final week.

Bullion costs traded underneath strain throughout the week with gold costs at COMEX struggled to maintain above $1900 per ounce for the second week whereas silver costs capped caped draw back with agency base metals. The dear metals declined on sturdy greenback restoration following optimistic US information as greater inflation signalled financial restoration. Bullion costs hovered in slim buying and selling vary on market hypothesis and buyers’ dilemma over FED coverage actions. The greenback index ended with 0.46% features at 90.56 whereas US 10 12 months treasury yields fell to 1.45% throughout the week. The greenback index fetched protected haven shopping for from treasured metals forward of US FOMC assembly this week as current optimistic information from US has raised market expectations of change in FED stance. Bullion costs might hold present buying and selling vary with bullish bias for brief time period awaiting recent triggers. 

We anticipate gold costs to commerce sideways to up within the coming week with COMEX spot gold resistance at $1920 per ounce and assist at $1850 per ounce. At MCX, Gold August costs have close to time period resistance at Rs 49,700 per 10 grams and assist at Rs 48,200 per 10 gram. COMEX silver spot has close to time period resistance at $28.90 per ounce with assist at $26.80 per ounce. MCX Silver July has necessary resistance at Rs 74,400 per KG and assist at Rs 69,800 per KG.

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

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