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Ahmedabad, Mar 16 Gold Futures extended losses on Tuesday after opening down ₹158 from previous close.
Gold April Futures on Multi Commodity Exchange (MCX) have lost over ₹2,800 in a week from the recent peak levels of ₹54,224 seen on March 8.
International gold too opened lower on Tuesday at $1,920 against the previous close of $1,929.7 for CME April Futures.
Comex Gold
CME Gold April Futures extended its downtrend falling from the all-time high levels of $2,078 an oz (a troy ounce is equal to 31.1 grams) reported on March 8 to the latest levels of $1,919, a fall of more than $150 in a week.
The steep fall in the yellow metal is attributed to factors including hope of a positive outcome from the ongoing negotiations between Russia and Ukraine, lower crude oil prices and US Federal Reserve's meet amidst raging inflation in the country. Federal Reserve’s FOMC meeting began on Tuesday and ends Wednesday afternoon with a statement.
The war concerns appeared subsiding while a rate hike measure by one of the world's top bank would make gold lesser attractive as an investment option over other instruments such as equities and bonds.
Comex Silver opened above $25 levels on Tuesday but sharply down from the last week's peak of $27.495 an oz. The most active CME May Futures traded at $25 an oz on Wednesday against previous close of $25.160 an oz.
MCX Gold
MCX Gold Futures opened at ₹51,406 on Wednesday, extending the losing trend. The yellow metal had hit an all-time high last week amidst strong global cues following the mounting war concerns.
However, the prices have been on a steady decline since.
The most active MCX April contract last quoted at ₹51,398 per 10 grams at 11.27 am down ₹166 or 0.32 per cent from previous close of ₹51,564. The Open interest for April contract was at 8,747 lots.
MCX Silver Futures too weakened tracking overall weakness in the bullion pack.
The most active MCX Silver May contract last quoted at ₹67,997 a kg at 11.27 am, down by ₹328 or 0.48 per cent from previous close of ₹68,325. The open interest was recorded at 6,106 lots in the early trades.
Spot gold
Spot Gold softened marginally on Tuesday after international gold continued its weakness. The retail gold prices hovered at ₹51,521 per 10 grams of 999 purity fine gold as quoted by India Bullion and Jewellers Association (IBJA) for afternoon rates.
Analysts speak
Analysts maintained that Gold and silver extended its fall amid anticipation of interest rate hike by the US Federal Reserve and heavy sell-off in crude oil.
Rahul Kalantri, VP – Commodities, Mehta Equities, commented, "Precious metals also plunged amid crude oil prices slipping below $100 a barrel for the first time in one week and easing safe-haven buying of precious metals. However, disappointing US empire state manufacturing data supported precious metals at lower levels."
The US Federal Reserve’s policy meeting outcome will be released on Wednesday. The market is expecting 25 basis point hikes in this meeting but the Federal Reserve Chairman’s comment on the inflation and Russia-Ukraine war will be directional for the precious metals.
"We expect volatility will remain in today’s session ahead of the FOMC meeting outcome. Gold has support at $1,905-1,888, while resistance at $1,940-1,962 per troy ounce. Silver has support at $24.81-24.64, while resistance is at $25.48-25.70."
According to him, gold will move between ₹50,680 and ₹52,365, and Silver will see support at ₹67,100 while resistance is at ₹69,350.
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