Yellow metal, silver drop, experts suggest buying on dips

Gold prices in India edged down on Thursday, following global peers. On the Multi-Commodity Exchange (MCX), June gold futures plunged 0.33% to Rs 48,622 for 10 grams at 4.30pm. July silver futures fell 0.21 percent lower to Rs 71,261 per kilogram.

In the international market, gold stabilized at the key $ 1,900 level on Thursday as the gains were controlled by a rising dollar as investors waited for far-reaching U.S. economic data that could offer clues to inflation and the Monetary Policy.

Spot gold had edged down 0.1% to $ 1,895.10 an ounce by 9:17 a.m. GMT, after hitting its highest level since Jan. 8 at $ 1,912.50 on Wednesday. US gold futures fell 0.3% to $ 1,898.50.

“International spot gold fell on Wednesday as the US dollar ended solidly higher. Silver spot prices also ended in the red on Wednesday. While the 10-year Treasury note gained for the first time in five sessions on Wednesday and also weighed on prices. However, the absence of other major indices or an economic calendar limited the decline on Wednesday, ”said Sriram Iyer, senior research analyst at Reliance Securities.

“International spot gold and silver prices began to weaken on Thursday morning in Asian trade ahead of the release of critical data tonight. Technically, the LBMA Gold Spot has given a strong correction from the $ 1,912 levels, forming an evening star candlestick, a sign of a bearish reversal. However, it could see a rebound from the levels of $ 1891 to $ 1884. Resistance is at the levels of $ 1899 to $ 1909. Technically, LBMA Silver holds a hurdle near $ 28.30 below what could see sideways momentum. However, a strong break above the level could take prices to levels of $ 28.66 to $ 29.20. Support is at $ 26.95 $ 26.30, “Iyer added.

“Technically, MCX Gold June could trade on a sideways momentum in the range of Rs 48,500 to 48,900. Technically, if MCX Silver July remains above the level of Rs 71,000, the markets could push up. ‘at Rs 71,900-72700 levels. Support is at the levels of Rs 70,700-69900, ”he added.

“Today traders are advised to go long and focus on some important technical levels given below for the day: Gold June closing price Rs 48,784, Support 1 – Rs 48,400, Support 2 – Rs 48,100, Resistance 1 – Rs 49,100, Resistance 2 – Rs 49,400. July Silver closing price Rs 71,411, Support 1 – Rs 70,500, Support 2 – Rs 70,000, Resistance 1 – Rs 72,300, Resistance 2 – Rs 73,100, ”said Amit Khare, AVP- research on commodities, Ganganagar Commodities Limited.

“The weakness of the US dollar and lower yields on US Treasuries continue to support gold’s safe haven status, and therefore demand for the commodity. Meanwhile, hopes of a rapid global economic recovery and firmness in global stocks are limiting major gains in the commodity. On MCX June, significant resistance of Rs 49,480 needs to be cleared for further increases. Or, there are chances of corrective selling pressure. Either way, major support is placed at Rs 46,920, ”said Hareesh V, head of commodities research at Geojit Financial Services.

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