Gold edged higher on Monday after a muted trend last week. On the Multi-Commodity Exchange (MCX), gold futures were up by 0.31% to Rs 49,301 for 10 grams at 10 am on May 31. July silver futures were trading 0.49% higher at Rs 71,962 a kilogram.
In the international market, gold prices fell on Friday as a stronger dollar and an uptick in US Treasury yields weighed on the safe-haven metal. Spot gold fell 0.4% to $1,887.90 per ounce by 0653 GMT. Bullion has risen 0.4% this week, on track for its fourth straight weekly gain on May 28. US gold futures slipped 0.3% to $1,892.30.
“Data released Friday showed the headline US personal consumption expenditure inflation measure climbed 3.1% in April from the prior year, the strongest reading since 2008 and higher than the 2% preferred by the Federal Reserve. The U.S. Dollar ended lower, while the benchmark treasury yields ended higher on Friday,” said Sriram Iyer, senior research analyst at Reliance Securities.
“International spot gold and silver prices have started flat to higher this Monday morning in Asian trade.We could witness choppy markets for the next few days due to lack of liquidity in light of the Memorial Day long weekend in the US. However, the major trigger point for gold this week could be Friday’s employment data out of the US. Also on the US economic calendar is the ISM manufacturing PMI, the ISM non-manufacturing PMI and factory orders,” he further added.
“Technically, LBMA gold spot is trading above $1900 level could see a bullish momentum up to $1911-$1923 levels. Support is at $1896-1888 levels. Technically, LBMA Silver holds a strong resistance near $28.35-$29.50 levels. Support is at $27.85-$27.00 levels,” he added.
India’s imports in April were nearly 70 tonnes, according to Refinitiv GFMS. It was down from 103 tonnes in March. However, the March figure was a two-year high and April’s imports were the second-best month so far in 2020, Iyer added.
Domestic gold and silver prices could start flat to higher this Monday morning tracking overseas prices. Technically, MCX Gold August above Rs 49,000 could see an upside move up to Rs 49,230-49,500 levels. Support is at Rs 48,950-48,800 levels. Technically, if MCX Silver July trades above Rs 71,300 could take prices up to Rs 72,020-73,000 levels. Support is at Rs 70,900-70,000 levels.
“Gold is making some big strides, rising above $1,900 an ounce for the first time since January. And gold bulls now want to see the $2,000 an ounce gold price target happen. Some of the main triggers behind the move are a weaker US dollar and crypto volatility. Central banks’ interest in gold is heating up. The International Monetary Fund data show that the Bank of Thailand bought 43.5 tones of gold in April,” said Amit Khare, AVP- research commodities, Ganganagar Commodities Limited.
In the domestic market, “technical chart gold and silver both trading on a strong up trend, So traders are advise to go long and focus some important technical levels given below for the day: June Gold closing price Rs 48,542, Support 1 – Rs 48,300, Support 2 – Rs 48,100, Resistance 1 – Rs 48,750, Resistance 2 – Rs 49,150. July Silver closing price Rs 71,611, Support 1 – Rs 70,900, Support 2 – Rs 70,500, Resistance 1 – Rs 72,300, Resistance 2 – Rs 73,250,” Khare added.
“Gold prices started Friday’s trade on a weak note opening slightly lower with a gap and fell further during the first half of the session till a low of Rs 48,250. However, prices did not sustain at lower levels and recovered strongly in the remaining session till a high of Rs 48,603. Prices have taken strong support in the last session as Fed officials have recently downplayed rising price pressures and affirmed their support to keep monetary policy accommodative for some time. Therefore, we expect gold prices to remain positive towards Rs 49,300 level in the short-term,” said analysts from ICICI Securities.