The bullish storm that has been raging in the precious metals market for the last three weeks is not showing any sign of stopping. This week too, a strong rise of 1.65 percent has been recorded in the prices of gold. On Friday, the last day of the trading week, the June futures price of gold on Multi Commodity Exchange (MCX) was seen trading at a historic level of Rs 1,52,690 per 10 grams. At the same time, the May futures of silver also touched the level of Rs 2,43,300 per kg, not lagging behind.
What is the condition of the retail market?
If we look at the data of the retail market i.e. India Bullion and Jewelers Association (IBJA), the situation there is more or less similar. The gold of 999 purity, which was at Rs 1,47,891 per 10 grams on Monday, jumped to Rs 1,50,327 by Friday. The speed of silver was even faster. Silver of 999 purity was Rs 2,31,028 per kg at the beginning of the week, which increased to Rs 2,39,934 by Friday.
Why are gold prices rising?
There are many big international reasons hidden behind this trend of the market. The most important reason is the increasing demand for safe haven. Whenever there is any geopolitical uncertainty in the world, investors rush to gold to park their money in a safe place.
Apart from this, the weakness in the US dollar has also increased the shine of gold. Global tension has reduced slightly due to the ongoing ceasefire talks between America and Iran, the direct effect of which has been seen in the form of pressure on the dollar. Gold has strengthened due to the weakening of the dollar. At the same time, due to falling prices of crude oil at the international level, there is hope that the inflation rate will reduce. In such a situation, the market is assuming that the US Central Bank (Federal Reserve) may cut interest rates in the coming time, which is always considered a very positive sign for gold.
What are the necessary support and resistance?
The glory of gold continues even at the international level. On Comex, gold closed at $ 4,787.40 per troy ounce with a weekly jump of 3 percent. Commodity market experts believe that the $5,000 level is a huge psychological and technical resistance. If prices cross this, a new and sharp rally may be seen in the market.
The movement of rupee against dollar will be very important for domestic investors. Recently, a slight strengthening of the rupee has helped in keeping the gold prices balanced to some extent in the Indian markets. If the dollar strengthens again, it will have a direct impact on domestic prices. From a technical point of view, there is a strong support for gold on MCX between Rs 1,48,000 to Rs 1,46,000. At the same time, profit booking or resistance can be seen on the upside at the level of Rs 1,54,000 to Rs 1,55,000. Talking about silver, the range of Rs 2,30,000 to Rs 2,25,000 is acting as a support zone, whereas in case of a big fall, it can get strong support between Rs 2,05,000 to Rs 2,00,000.