The uptrend in Comex gold witnessed in July spilled over to August as well. The price of Comex gold scaled a new all-time high and settled above the psychological $2,500-level.
The weakness in the U.S. Dollar along with the expectations of an interest rate cut in the U.S. played a key role in bolstering sentiment towards the precious metals.
As a result, both Comex gold and silver closed on a strong note last month. Comex gold gained 2.2% in August to settle at $2,527.6 an ounce. After a subdued trend in July, Comex silver gained some sheen in August and closed about 1% higher at $29.14 an ounce.
Mirroring global trend
Reflecting the positivity in the global markets, the precious metal prices closed on a strong note in the domestic markets too. MCX gold gained 2.8% in August and closed at of ₹71,611 per 10-gram. MCX silver, however, closed 0.6% lower in August to settle at ₹85,210 per kilogram.
As anticipated last month, the Comex gold price continued to move higher and also managed to reach the then-mentioned target zone of $2,575-2,585.
Positive outlook
The short-term as well as the medium-term outlook is still positive and Comex gold price could head to the next target zone of $2,620-2,650.
The positive outlook for Comex gold would be under threat only if the price closes below the support zone at $2,300-2,310. Until the price drops below $2,300, it would be reasonable to expect the price to reach the target of $2,650 and beyond.
As observed last month, Comex silver price is still confined within the broad range of $26-32.5. Though the overall trend is still positive, the Comex silver price has to move past $32.5 to signal the start of the next move to the upside. The positive outlook would be under threat if the price falls below $26.
In line with last month’s expectations, MCX gold price moved higher and also reached the then mentioned target of ₹72,100-72,900. The short-term outlook for MCX Gold is positive and the price could move higher to the next target of ₹73,900-74,500. A fall below ₹69,900 would invalidate the short-term positive outlook.
Smart recovery
MCX Silver staged a smart recovery after a weak trend in the early part of August. The short-term outlook is positive and a move to ₹89,700-91,200 appears likely. The positive outlook for MCX Silver would be invalidated if the price drops below ₹79,900.
To summarise, the short-term outlook for Comex gold and MCX gold appears positive while Comex silver is likely to remain range bound. Keep an eye on the upside trigger levels for further cues.
(The author is a Chennai based analyst / trader. The views and opinion featured in this column is based on the analysis of short-term price movement in gold and silver futures at COMEX & Multi Commodity Exchange of India. This is not meant to be a trading or investment advice.)
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