Gold price falls for fifth consecutive session, silver rates at Rs 70,500

Gold, Silver prices in India on August 14: Gold price in Indian commodity market fell for the fifth consecutive session on Friday amid a mild recovery in global markets. Overseas, gold and silver prices recouped from the worst fall in seven years and traded flat in Friday's session as investors digested better-than-expected unemployment data in the US. However, the stalemate in stimulus negotiations strengthened concerns over economic slowdown due to the Covid-19 pandemic and helped the metal cap losses.

MCX

The yellow metal continued bearish momentum for the fifth session, declining 0.50% or Rs 260 at Rs 52,670, after hitting an intraday high of Rs 52,700 against the previous close of Rs 52,930 per 10 gm. MCX gold futures trade almost Rs 3,491 lower than the lifetime high of Rs 56,191 per 10 gm, hit last Friday.

Silver September futures were trading Rs 565 lower at Rs 70,512 per kg today after they touched an intraday high of Rs 70,650 per kg. Silver Futures have hit a lifetime high of Rs 77,949 in last Friday's session.

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Global markets

Overseas, gold and silver prices stayed flat after yesterday's pullback as the dollar slipped. Although, better-than-expected unemployment data and impasse in stimulus negotiations in the US kept bearish momentum in the metal.

Spot gold was down 0.1% at $1,952.01 an ounce, after falling 4% so far this week, its biggest weekly percentage fall since early March. While US gold was trading 0.5% to $1,960.50, Comex Gold was flat at $1,956 per ounce.

Silver also snapped its 9-week winning streak, dropping 3.5% so far. The precious metal dropped 1.1% to $27.26 per ounce today.

Amid the coronavirus-driven slowdown, the bullion metal has been on a continuous rise in 2020, gaining about 28% value. However, news of Russia approving the world's first covid vaccine earlier this week triggered profit-taking in gold and silver rates and the commodities have continued to trade in bearish momentum since then.

Rising US-China tensions and correction in the dollar has also led to profit-booking in the safe-haven asset. The tension between the world's two largest economies escalated after the ban on Chinese apps in the US-led to Beijing imposing sanctions on 11 US officials. Now, investors are keeping an eye over the US-China key trade talks scheduled on August 15, 2020. Breakthrough in the stalled US stimulus talks will also set this trend for the commodity.

Gold price falls for 4th day, trades above Rs 51K mark 

Retail gold rate in India

24-carat gold prices in the national capital traded at Rs 55,910 per 10 gram. Price of 24-carat gold stood at Rs 55,510 per 10 gram in Chennai. In Mumbai, the rate was Rs 52,260 for 24-Carat gold, as per Good Returns website.

Valuation

As per analysts, both equities and commodity markets have turned mixed as investors remained wary over the uncertainty regarding the fresh US economic relief and worsening coronavirus crisis on a global scale. Meanwhile, Russia's claim of developing a corona vaccine has also led to the recent fall in metal.

Commenting on Gold's outlook, Hareesh V, Head Commodity Research at Geojit Financial Services said," Gold lost some ground after Russia announced the world's first Covid vaccine and profit booking was seen at higher levels. A recovering US dollar and gains in equities too pressured the safe-haven asset. However, hopes of fresh economic stimulus measures and rising US-China tensions continue to offer lower-level support to the metal."

On London spot technical outlook, Geojit Financial Services said in a note, "Sustained trades above $1980 are required to continue upticks in the counter. Else, likely for corrective selling pressure towards $1860 followed by $1780 levels later."

As per the brokerage, MCX Gold August, resistance is placed at 53,600 and support is at 51,400/49,200. For MCX Silver August futures, the resistance is at 72,200/74,980 and the support is placed at 60,100.

Precious metal prices have been surging to fresh record highs in domestic as well as international commodity markets, amid intensifying economic concerns due to the COVID-19 pandemic. India continues to see rising number of coronavirus cases, with new infections taking the total to 24.59 lakh mark today, with total deaths standing at 0.48 lakh. Worldwide, there are 210 lakh confirmed cases and 7.57 lakh deaths from COVID-19 outbreak.