Gold prices trade at Rs 1,09,870/10 grams as markets await Fed chief’s remarks. Profit-booking or fresh rally ahead?
Despite the modest decline, the yellow metal remains well-supported as investors look to Fed Chair Jerome Powell for signals on the future direction of rate cuts.
Meanwhile, silver December futures saw a sharper fall, with prices on MCX dropping Rs 1,330 or 1.03% to Rs 1,27,490 per kilogram.
Globally, the dollar weakened, stock indices edged lower, and gold reached new highs as markets awaited the Fed’s expected rate cut and clues on the pace of future easing.
The Fed is expected to cut its benchmark interest rate by a quarter of a percentage point to the 4.00%-4.25% range at the end of its monetary policy meeting later in the global day. The main focus beyond the rate decision will be on Chair Jerome Powell’s comments on the outlook for U.S. monetary policy.
On Tuesday, gold and silver settled on a slightly weaker note in the domestic market and on a mixed note in the international markets. Gold October futures contract settled at Rs 1,10,156 per 10 grams with a loss of 0.02% and silver December futures contract settled at Rs 1,28,820 per kilogram with a loss of 0.47%.Gold and silver show very high price volatility and extended their gains in the early trading session, but were unable to hold their gains amid progress in the US-India trade talks and ahead of the FOMC meeting outcomes.Gold prices hit a record high amid possible Fed rate cuts and silver prices fell from their fresh 14-year high amid profit taking from higher levels
“The dollar index and the U.S. 10-year bond yields slipped amid strength in the Euro and possible Fed rate cuts and supporting gold and silver prices. However, strength in the rupee limits gains of gold and silver in the domestic markets,” said Manoj Kumar Jain of Prithvifinmart Commodity Research.
Today, the US Dollar Index, DXY, was hovering near the 96.72 mark, gaining 0.09 or 0.09%.
“We expect gold and silver prices to remain volatile this week amid volatility in the dollar index, US-India trade deal updates, and FOMC meeting outcomes, and gold are expected to trade in the range of $3,534-3,800 per troy ounce and silver is expected to trade in the range of $41.40-44.50 per troy ounce this week,” he added.
How to trade gold?
Manoj Kumar Jain suggested the following ranges for gold and silver on MCX:
- Gold has support at Rs 1,09,720-1,09,300 and resistance at Rs 1,10,666-1,11,000
- Silver has support at Rs 1,27,700-1,26,650 and resistance at Rs 1,30,000-1,31,200
Jain suggests avoiding fresh positions in gold and silver ahead of the FOMC meeting outcomes and traders can also book profit once in the existing long positions.
“For long-term investors, there is no need to worry as long-term bullish trend is intact for both precious metals,” he added.
Gold rates in physical markets
Gold Price today in Delhi
Standard gold (22 carat) prices in Delhi stand at Rs 57,312/8 grams, while pure gold (24 carat) prices stand at Rs 61,088/8 grams.
Gold Price today in Mumbai
Standard gold (22 carat) prices in Mumbai stand at Rs 57,744/8 grams, while pure gold (24 carat) prices stand at Rs 61,536/8 grams.
Gold Price today in Chennai
Standard gold (22 carat) prices in Chennai stand at Rs 57,008/8 grams while pure gold (24 carat) prices stand at Rs 60,496/8 grams.
Gold Price today in Hyderabad
Standard gold (22 carat) prices in Hyderabad stand at Rs 57,032/8 grams while pure gold (24 carat) prices stand at Rs 60,752/8 grams.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)