Yellow metal inches down, silver softens; What moves gold


Gold futures at Multi Commodity Exchange (MCX) on Friday edged lower, while silver prices showed a softer tone. The bullion has been on a rising spree this week with inflationary pressure emerging as the driving force. While Russia-Ukraine conflict and its dominance on markets add further to comfort these commodities. Meanwhile, support in yellow metals is also due to signs of the US Federal Reserve’s more aggressive approach for monetary policy tightening. Domestic commodities tracked international movement. Appetite for havens like gold is currently the need of the hour for investors who are looking for risk aversions.

At MCX, gold futures maturing on April 05, 2022, was trading at 51968 lower by 110 or 0.21% currently. The commodity has touched the day’s high and low of 52100 and 51915.

As for silver futures maturing on May 05, 2022, at the exchange, was trading at 69255 down by 65 or 0.09%. The metal traded between the day’s high and low of 69663 and 69222 respectively.

IIFL Securities in its commodities mantra for March 25, stated that “Gold prices steady on Thursday as support from the Russian invasion of Ukraine was countered by signs that U.S. Fed officials could act more aggressively to control inflation.”

Giving its technical view, IIFL in its note said for today’s outlook said, “Gold prices broke through the upper range of consolidation band. Sustainable trade above yesterday’s high will be seen as confirmation of the bullish journey ahead. Fast stochastic has generated a crossover buy signal, while the trajectory of the MACD histogram is sloping upward. Intraday support lies at 51800/51550, resistance at 52500/52850.”

Furthermore, for the silver outlook, IIFL’s note adds, “Silver is likely to trade sideways up as prices moved above their immediate horizontal resistance. Fast stochastic has generated crossover buy signal with recouping sharply from rising trend line support on a daily chart. Intraday support lies at 68500/67700, resistance at 70100/71000.”

However, in India, both 24 carats and 22-carat gold inched higher while silver followed the suit. In Mumbai, 10 grams in 24-carat gold was at 52,590 up from yesterday’s price of 52,310. The 100 gram in 24-carat gold was at 5,25,900 versus the previous day’s 5,23,100. As for 10 gram in 22 carat, was at 48,200 against yesterday’s 47,950 and 100 grams in 22 carat stood at 4,82,000 up from 4,79,500.

In Mumbai, silver price in 1 kg rose to 70,000 today against the previous day’s Rs68,500. 10 gram and 100 gram in silver also increased to 700 and 7,000 respectively.

On the global front, the spot gold has extended its rally and snapped to new highs. The spot gold so far today has reached over $1,960-level. The yellow metal surpassed the $1,950 level as inflation fears take a toll on investors. The four-decade high inflation in the United States does not seem to calm down anytime soon indicating that the Fed could take a more aggressive approach in hiking policy interest rates. The Fed has already raised interest rates by 25 basis points in the latest policy and they expect six more hikes in the future to control rising inflation.

Vidit Garg, Director, MyGoldKart said, “Yesterday Gold climbed after record good unemployment claims proving many of us wrong in predicting its direction, It went up after new Sanctions disabled Russia to sell Gold for meeting its fiscal plans and raised the worries of Russian Debt,” adding, “Technically for almost 12 hrs it’s trading above 1960$ hence expecting weakness without any news for peace from the war front, move below 1956$ may bring it towards 1942 while if it sustains above 1968 then 1980 kind of levels are expected.”

Further, Garg said, ” Adx on intraday charts is around 45 which means soon we may find exhaustion among buyers.”

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