Gold price today: Yellow metal gains, Silver May futures rise over 1%

Market Outlook
Source: Reuters

Source: Reuters

India Gold MCX April futures rose on Monday following a positive trend seen in the international spot prices. Silver May futures rose over a percent.

International Gold prices recovered from near nine-month low hit in the previous session, as a passage of the long-awaited $ 1.9 trillion U.S. coronavirus relief package boosted the metal’s appeal, said a Reuters report.

On the Multi-Commodity Exchange (MCX), April gold contracts were trading higher by 0.11 percent at Rs 44,730 for 10 grams at 0920 hours. May silver futures were trading 1.3 percent higher at Rs 66,473 a kilogram.

On Friday, gold and silver prices settled on a weaker note in the international markets. Gold April futures contract settled at $ 1,698.00 per troy ounce, and Silver May futures contract settled at $ 25.28 per troy ounce.

Due to weakness in the rupee domestic markets were settled on a mixed note. Gold April futures contract settled at Rs44,683 per 10 grams, and Silver May futures contract settled at Rs65,603 per kilogram.

Gold and silver prices slipped again last week. International Gold spot prices fell for the third straight week and breached important support of $ 1700 per troy ounce on a weekly closing basis.

“Record surge in the 10-year U.S. bond yield and the dollar index pushed both the precious metals lower. Dollar index crossed 92 marks and 10-year bond yield tested one-year highs of 1.61% before settling at 1.57% last week,” Manoj Jain, Director (Head-Commodity & Currency Research) at Prithvi Finmart told Moneycontrol.

“We expect both the precious metals remain volatile this week and if gold sustain below $ 1700 could show further weakness towards $ 1684-1670 per troy ounce. Gold has support at $ 1684-1670, while resistance at $ 1712-1728 per troy ounce. Silver has support at $ 24.88-24.55, while resistance is at $ 25.70-26.00 per troy ounce,” he said.

Jain further added that MCX Gold has support at 44440-44200 and resistance at 44850-45055, Silver has support at 65200-64700 and resistance at 66300-67000 levels. “We suggest selling on the rise in the gold around 44900 with a stop loss around 45155 for a target of 44400,” he said.

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Trading Strategy:

Ravindra Rao, VP- Head Commodity Research at Kotak Securities.

COMEX gold trades 0.5% higher near $ 1708/oz after a 0.1% decline on Friday when it tested June 2020 lows. Gold has edged up on the back of progress on the US stimulus front as the Senate approved the $ 1.9 trillion package which will now go to the House for a vote.

However, weighing on price is continuing ETF outflows, upbeat non-farm payroll data, and higher US and global bond yields. Gold has bounced back above $ 1700/oz and may see extended gains on US stimulus optimism however a sharp rise is unlikely unless US bond yields correct sharply.

Sriram Iyer, Senior Research Analyst at Reliance Securities

International gold prices rebounded on Friday from the lows of the session. Silver underperformed gold and ended lower on Friday.

However, both gold and silver prices crashed initially after better-than-expected U.S. employment data bolstered the dollar and U.S. Treasury yields.

Domestic gold recovered on Friday tracking overseas prices, while silver extended losses on Friday tracking overseas prices.

Domestic gold and silver prices could trade higher this Monday morning tracking overseas prices.

Technically, MCX Gold April supports are at 44500-44250. Resistance is at 44730-44900. MCX Silver May supports are at 65100-64300. Resistance is at 6400-67230.

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