Gold price rises after 2 days; silver rates at Rs 65,500

Gold, Silver prices in India on August 28: Gold price in India erased recent losses and gained on Friday in line with global markets as Treasury yields rose post-Fed Chairman's speech in which he hinted at shifting inflation target. Globally, precious metals surged today, pressured by a jump in US Treasury yields on Federal Reserve Chair Jerome Powell's offer for more inflation tolerance.

Longer-term US Treasury yields climbed to their highest levels in months on Thursday as investors digested the US Federal Reserve's new strategy to adopt an average inflation target and restore full employment in the United States.

Globally, rising coronavirus cases also helped the commodity to cap losses. In India, the death toll touched 61,694 and total coronavirus cases reached 33.83 lakh as of Friday. Worldwide, there were 246 lakh confirmed cases and 8.35 lakh deaths from COVID-19 outbreak.

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MCX

On the Multi-Commodity Exchange, Gold October Futures rose by Rs 215 at Rs 51,115, after hitting an intraday high of Rs 51,224 against the previous close of Rs 50,902 per 10 gm. MCX gold futures currently trade almost Rs 5,289 lower than the lifetime high of Rs 56,191 per 10 gm, hit on August 7.

On MCX, the yellow metal has risen 41.5% to life-time high since the beginning of the year amid concerns over rising coronavirus cases around the globe. Bullion that was trading at Rs 39,000 on December 31, 2019, recently hit a lifetime high of Rs 56,191 per 10 gm on August 7, 2020.

On a similar note, Silver September Futures gained Rs 592 higher at Rs 65,782 per kg today after they touched an intraday high of Rs 66,200 per kg. Silver Futures hit a lifetime high of Rs 77,949 on August 7.

Gold price slips after two days; silver rates at Rs 66,700

Global markets

Precious metals reversed the trend to positive territory today, following a sharp rise in the US Treasury yields and drop in the dollar index, against the basket of Asian currencies.

However, the impasse on the US stimulus capped early gains. Gold price in the international market was seen below $1950 an ounce, while silver was trading near previous day's high of $27.52 an ounce.

In the international spot market, spot gold was up 0.1% at $1,929.94 per ounce, after falling more than 1.2% yesterday. While Comex gold was rising 0.01% at $1,940 per ounce, US gold futures rose 0.2% to $1,936.30. Silver eased 0.1% to $27.01 per ounce.

Overall, gold has fallen more than 0.5% so far this week.

Retail gold rate in India

24-carat gold prices in the national capital traded at Rs 55,210 per 10 gram. Price of 24-carat gold stood at Rs 54,280 per 10 gram in Chennai. In Mumbai, the rate for 24-Carat gold stood at Rs 51,360 as per Good Returns website.

Valuation

As per Geojit Financial Services, prices continue to trade in a range. The resistance of $1976 needs to be cleared for the continuation of rallies. Likewise, the immediate downside obstacle of $1900 should be broken to trigger selling pressure.

For MCX Gold August, resistance is placed at 52,320 and support is at 49,960. For MCX Silver August futures, resistance is at 71,250 and the support is placed at 65,580.Commenting on gold's near term outlook, Anuj Gupta, DVP-Commodities and Currencies Research, Angel Broking said," Yesterday, Gold prices fell by 1.69%  and closed at Rs 50,902 levels. Silver also fell by 3.46% and closed at 65,190 levels.  In international market, Gold is trading at $1936 levels and silver is trading at $27.16 levels. We are expecting again selling pressure may be seen in gold and silver prices as the dollar held gains against major currencies after the Federal Reserve's aggressive new strategy to lift employment and increased tolerance for higher inflation pushed US bond yields up."

On MCX, he added," As of today, traders can go for sell in gold at Rs 51,200 levels with the stop loss of Rs 51,750 levels for the target of 50,400 levels. They can also go for sell in Silver at Rs 66,100 levels, with the stop loss of 67,200 levels and for the target of 63,5000 levels. In the Bullion index, bulldex traders can also go for sell at 16100 with the stop loss of 16250 and for the target of 15800."

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