Informist, Thursday, Aug 17, 2023
By Sandeep Sinha
MUMBAI – Futures contracts of GOLD fell on the Multi Commodity Exchange of India and COMEX today after the US Federal Open Market Committee's July meeting minutes showed that officials continue to have a bias to hike interest rate further. The sentiment was also hurt by continuous outflow in gold exchange-traded funds.
The trend has become bearish for bullion in the international market as the price broke below the short-and-medium term simple and exponential moving averages on the daily chart. The momentum indicator Relative Strength Index was at 36.62, suggesting weakness in the price.
Gold holdings with SPDR Gold Trust, the world's largest gold-backed exchange-traded fund have fallen by 18.5 tn to 894.43 tn in August, the lowest since January 2020. The fund has a market value of $54.79 bln.
However, the downside in gold prices was restricted due to weakness in the dollar index, which measures the strength of the greenback against a basket of six major currencies. The index was down 0.1% at 103.31 ahead of the jobless claims report, due later today. Analysts polled by Dow Jones had estimated the jobless claims to come in at 240,000.
The spot gold-silver ratio, also known as the mint ratio, was lower at 83.52, indicating that gold had outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold.
SILVER prices traded firm, taking cues from prices of industrial metals and a weaker dollar.
At 1700 IST, MCX Bulldex, an index tracking the real-time performance of gold and silver futures on the MCX, was down just 2 points at 15660.
The October and December gold contracts recorded turnovers of 14.84 bln rupees and 1.17 bln rupees, respectively. At 1700 IST, the September and December silver contracts saw turnovers of 15.30 bln rupees and 3.32 bln rupees, respectively.
The average traded price for the October gold contract on the domestic exchange was 58,478.62 rupees per 10 gm.
On the daily technical charts, the MCX October gold contract traded lower than the five-, 20-, 50- and 100-day simple moving averages but higher than the 200-day simple moving average. The momentum oscillator, Relative Strength Index, was at 40.56, indicating a further downside in price.
At 1700 IST, following were the most active contracts of bullion:
-October gold was down 0.2% at 58,582 rupees per 10 gm on MCX
-December gold was down 0.1% at $1,926.0 an ounce on COMEX
-September silver was up 0.7% at 70,186 rupees per kg on MCX
–September silver was up 1.2 at $22.79 an ounce on COMEX
Outlook for the rest of the session:
-MCX gold seen at 58,050–58,900 rupees per 10 gm
-COMEX gold seen at $1,910.0–$1,940.0 an ounce
-MCX silver seen at 69,500-70,450 rupees per kg
-COMEX silver seen at $22.60-$22.95 an ounce
End
US$1 = 83.15 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Deepshikha Bhardwaj
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