Gold is in an uptrend for the third consecutive month, partly due to strong demand from central banks and investors looking for safe investments.
On the American markets, the price of gold is currently holding around $2,330 per ounce. This increase, of almost 5% this month, comes before the Federal Reserve meeting. The Fed is expected to take a more cautious stance in response to recent high inflation rates, which could impact future interest rate cuts.
Despite predictions that the Federal Reserve may not cut interest rates as quickly as previously suggested, the value of gold has surged more than 13% this year. Heavy central bank buying, strong demand from Asian markets like China, and ongoing geopolitical tensions in regions like Ukraine and the Middle East have boosted sentiment.
Additionally, the U.S. dollar has weakened recently, which tends to make gold, priced in dollars, more attractive to international buyers. This effect has been amplified by speculation that Japan could intervene to support its currency, the yen, which could potentially further weaken the dollar and boost gold prices. Today, the US Dollar Index, DXY, was hovering near the 105.85 mark, up 0.27 or 0.25. %.“On the daily chart, gold (June) appears to be entering a downtrend as the highs and lows gradually diminish. Price is currently held by an ascending channel; However, a break below the support level at 70,200 could signal further declines. Additionally, the Relative Strength Index (RSI) shows a pattern of lower highs and lower lows, supporting a bearish outlook. The main resistance levels to watch are at 71,800 and 72,300, while important support levels lie at 71,200 and 70,700,” said Neha Quereshi, Anand Rathi Commodities & Currencies.
Intraday Strategy by Neha Quereshi:
– Sell MCX JUNE Gold futures at Rs 71600 with a stop loss of Rs 72000 and a price target of Rs 71200
– Sell MCX JULY Silver futures at Rs 82400 with a stop loss of Rs 83400 and a price target of Rs 80400
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
