Gold & Silver

Gold, silver hover steady after RBI's surplus transfer move

Rutam Vora Ahmedabad | Updated on August 27, 2019

Representative image   -  REUTERS

Sentiment shifts towards equities as economic concerns appeared easing

After attaining fresh peak on Monday, gold and silver prices came under pressure on Tuesday to trade nearly flat after weak opening.

Easing economic concerns, post the Reserve Bank of India (RBI) infusing Rs 1.76 lakh crore to Government kitty, has given equities a run-up, while pushing bullion for a consolidation.

In futures trade, MCX October Gold opened negative but soon gained momentum to trade at Rs 38,900 per 10 grams about RS 70 up from Monday's close. MCX September Silver slipped by Rs 100 in opening trade but recovered to stay positive at Rs 45,102 a kg marginally up from Monday's close.

Prices in the spot markets too are expected to take a pause on Tuesday after a steady rally over the past week.

The Reserve Bank of India (RBI) on Monday decided to transfer Rs 1.76 lakh crore to the government during this fiscal raising fresh hopes for economic revival.

Global factors such as trade tension between the United States (US) and China are already factored-in, while festive buying hasn't yet picked up in India, which is causing prices to move range-bound with upward bias.

Comex Gold for September delivery gained marginally at $1531.6 as against previous close of $1530.9 an oz.

Comex Silver for September hovered stable at $17.64 on Tuesday.

"Gold price trades with clear negativity to attack 1535.00 level, which requires being aware from the upcoming trading, where the continuation of the negative pressure and holding below this level will push the price to achieve more of the downside moves and testing 1503.24 levels before any new positive attempt, while the price needs to step above 1535.00, to regain the bullish trend that its next targets are located at 1560.00 and 1600.00. The expected trading range for today is between 1518.00 support and 1556.00 resistance," stated Kedia Advisory in its Tuesday's note.

For silver, it hinted at a bearish bias. This was in attempt to cover the price gap that appeared with yesterday’s opening. “As long as the price is above 17.30, our bullish trend expectations will remain valid for today,” it added. The expected trading range for today is between 17.45 support and 17.90 resistance.

Published on August 27, 2019

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