Gold rates in India near lowest in 3 months
Premium- Gold prices in India struggled to hold the ₹50,000 mark while silver rates hovered near multi-year lows
Gold rates in India remained near three-month lows tracking a weak global trend in precious metals. On MCX, gold futures fell to ₹50,050 per 10 gram in early trade, before recovering slightly to ₹50184. Silver edged higher to ₹52807 per kg. Gold remained weak in international markets and traded below the key level of $1,700 per ounce. A rally in US dollar and firm US bond yields have put pressure on precious metals. Traders are awaiting key US jobs data, due later today, which could provide further clues on the size of the Federal Reserve’s next interest-rate hike.
Ravindra Rao, VP- Head Commodity Research at Kotak Securities, said: “COMEX gold trades little changed near $1710/oz as the US dollar index and bond yields stalled after recent rise. Market players are now positioning for US non-farm payrolls report which may help form expectations for Fed’s monetary policy. "
"The recent move shows that one jobs reading may not be enough to shift Fed’s tightening stance so we may not see much reaction unless the jobs report disappoints significantly. A weaker report could result in some correction in the US dollar lending support to commodities at large hence one should be cautious in creating fresh shorts," he added.
Traders anticipate another large 75 basis points rate rise to contain price pressures at Fed's next policy decision meeting September 20-21. So far this week, gold is down over 2% in international markets.
Gold Price Technical Outlook
Rahul Kalantri, VP Commodities, Mehta Equities Ltd said: "The yellow metal has remained firmly in the red for the third consecutive week and is on track for the fifth straight month of losses, down almost 12% since April. Fundamentals remain negative for the metal, while bearish technical studies add to the weak structure.
However, “due to oversold conditions, some amount of consolidation could be seen in the gold prices going ahead. The Euro zone inflation hit a record 9.1% in August and, hence the ECB could also start raising interest rates to control inflation. However, the U.S. ADP non-farm employment data released on Wednesday was below expectations and supported gold prices at lower levels," he added.
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“Gold has support at $1698-1684, while resistance is at $1722-1735. Silver has support at $17.55-17.40, while resistance is at $18.25-18.42. In rupee terms gold has support at ₹50,050–49,840, while resistance is at ₹50,520–50,740. Silver has support at Rs52,550-52,120, while resistance is at ₹53,580–53,910."
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