Gold Futures Rebound To Trade Above Rs 47,000 Mark: Should You Invest?


Gold Rates Today: Domestic spot gold opened at Rs 47,169 per 10 grams on Friday

Highlights

  • Gold futures traded above Rs 47,000 mark today
  • Gold prices may fall in the upcoming session, say experts
  • Gold scaled a seven-week peak today as US yields retreated

Gold Price In India: Domestic gold futures witnessed a volatile trading session on Friday, April 15. On Multi Commodity Exchange (MCX) gold futures, due for a June 4 delivery, were last seen trading higher by Rs 248 – or 0.53 per cent – at Rs 47,423, having swung between Rs 46,820 and Rs 47,432 during the session so far, compared to their previous close of Rs 47,175. Silver futures for a May 5 delivery were last up 0.77 per cent at Rs 69,068. Some experts believe that a pickup in the global economy may lead to subdued gold rates (Also Read: Is Silver The New Gold?

Some experts predict that domestic gold prices could hover in the range of Rs 46,850- 47,450. Domestic spot gold closed at Rs 47,169 per 10 grams on Friday, and silver at Rs 68,810 per kilogram – both rates excluding GST, according to Mumbai-based industry body India Bullion and Jewellers Association (IBJA).

Gold Scaled Seven-Week Peak As US Yields Retreat

Gold prices today scaled a seven-week high and were set for their best weekly gain since mid-December as a pullback in U.S treasury yields and the American currency lifted the yellow metal’s appeal. Some analysts expect a decline in prices in the upcoming session. Low prices could provide a good opportunity for traders to invest.

”International Gold and Silver prices are trading with gains as US Treasury yields and US dollar weakened, lifting the precious metals’ appeal……Technically, International Gold is trading bullish momentum. Prices breached the resistance of $1750- $1760 levels and are sustaining above them,” said Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited.

”On the domestic front, MCX Gold June opened on a negative note and has been trading near the monthly high of 47279. A decline was witnessed in the early hours of the day which was covered in the afternoon session. We may expect a dip in prices in the upcoming session, which could act as a buying opportunity for the traders,” said Mr Purohit.

”Like Gold, International Silver is also trading with bullish momentum. Prices are sustaining above the resistance levels of $25.5-$25.6 and are trading at $26.20 levels for the first time in this month. MCX Silver May opened on a negative note and has been trading with positive bias below 69000 levels. We may expect a marginal fall in prices till the levels of 68600-68400 in the evening session after which bulls may dominate,” he added.

What analysts say:

“Gold traded higher to a more than one-month peak as U.S. Treasury yields slipped despite better than expected U.S. economic data, pushing investors to bullion as a refuge against possible inflation ahead. Concerns regarding inflation is increasing ahead of massive fiscal aids and ultra-low interest rates across the globe supporting the metal,” said Navneet Damani, VP – Commodities Research, Motilal Oswal Financial Services

Gold prices also got a boost after the U.S. government imposed a broad array of sanctions on Russia as punishment for alleged misdeeds, including interfering in the 2020 U.S. election after a positive retail sales and weekly jobless claims… Broader range on COMEX could be between $1745- 1778 and on the domestic front prices could hover in the range of Rs 46,850- 47,450,” he added.

“The rise in the number of COVID19 cases, fear of the next wave coupled with rising inflation in the US, lower yields, weak US Dollar, and the QE program by the US government has also provided strength to the gold prices. The current situation of rising cases threatens to derail the economic recovery in Q1, create uncertainties. The situation may lead to elevated gold prices in the short term till the situation stabilizes,” said Mr. Nish Bhatt, Founder & CEO, Millwood Kane International – an investment consulting firm

”The retail demand in India has been rising due to festive season buying has also provided support to gold prices. A pick-up in global economic activity will lead to subdued gold prices, but the risk of the second wave, uncertainty remains which may guide gold prices in the longer term,” he added.





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