Gold Steady at Rs 73124 Silver Dips After Surge June 7, 2024

While traders anticipate the release of the crucial US jobs report later today, gold prices fluctuated somewhat on June 7th, mostly in the negative direction.

Today, June 7, 2024, saw a slight increase in domestic yellow metal futures, while gold prices on the global market are expected to rise for the first time in three weeks due to growing speculation that the US central bank will lower interest rates sooner than expected. This is expected to cause a decrease in the dollar index and treasury yields.

The MCX gold August futures contract had a 0.01 percent, or Rs. 7, reduction at the time of the last count. After scaling to Rs 73,516 per 10 gm at the day’s high, the MCX gold August futures contract traded with a decrease of 0.01 percent, or Rs 7, at Rs 73,124 at the latest count. Similarly, the July contract for silver futures traded at Rs 93,738 per kg, down 0.08 percent, or Rs 78.

Following the ECB’s move to lower interest rates and a decrease in the yields on US bonds, gold and silver kept rising. Interest rate predictions are declining globally. The European Central Bank (ECB) lowered its main refinancing rate by 0.25 percent to 4.25 percent on Thursday, while the Bank of Canada (BoC) lowered its overnight rate from 5 percent to 4.75 percent on Wednesday.

Following the ECB’s rate cuts, the yield on US 10-year bonds fell precipitously, and the dollar index likewise declined from its peak, supporting the price of gold and silver.

As everything is going on, traders are anticipating a significant US jobs data that is expected to influence the Federal Reserve’s perspective on interest rates later today. The anticipated data will demonstrate that although the unemployment rate remained unchanged in May, the US added 180,000 jobs.

Rahul Kalantri, VP Commodities at Mehta Equities, stated, “We expect gold and silver prices to remain volatile in today’s session ahead of the U.S. job report and fluctuations in the dollar index.”

In the meantime, COMEX gold was up 0.07 percent at $2,392.5 an ounce on the global market.

Gold is facing resistance around $2391-2405 and support at $2351-2335. Silver’s resistance is at $31.32-31.50, and its support is at $30.82–30.67. Gold’s resistance is at Rs 73,340–73,550 in Indian rupees, while support is at Rs 72,880-72,650. According to Kalantri, there is resistance at Rs 94,470-95,150 and support at Rs 93,250-92,680 for silver.

Prospects for Gold, Gold Steady at Rs 73124 Silver Dips After Surge June 7, 2024

In light of less-than-expected non-farm payrolls data, which may raise the likelihood of rate reduction by the Federal Reserve, gold continues to be supportive. Through the December fed funds rate futures contract, traders anticipate 39 basis points (bps) of interest rate reductions by the end of 2024, according to data from the Chicago Board of Trade (CBOT). Neha Qureshi, Senior Technical Analyst at CME, observed that traders are presently pricing in a 57% possibility of a rate cut in September based on the CME FedWatch Tool. and Anand Rathi Commodities & Currencies’s Derivative Research Analyst.

What does Gold look like on technicals?

Technically, gold had continued to rise this week following a period of stabilization, with buyers breaking through the upper limit of the range, paving the way for additional gains. According to Qureshi, the primary technical signs continue to point in the direction of buyers. In the meantime, the bullish narrative surrounding the dollar that was prevalent at the beginning of the year has completely changed since last month. This suggests that there may not be as many reasons to support gold during the next leg up, which may potentially lead to new highs for the metal in the coming weeks.

Silver and gold trading plan for June 7, 2024
In the MCX Gold August contract, Qureshi advises a “buy on dips” strategy with a goal price of Rs 73,700 and a stop loss of Rs 72,600. In the Silver July contract, she recommends a buy on dip strategy with a target price of Rs 95,800 and a stop loss of Rs 92,800.

The following is a summary of some of the nation’s largest cities’ indicative spot gold prices:

India’s city-specific gold rate (24k) as of June 7, 2024

(Disclaimer: We have gathered these approximate costs from reliable sources. It is recommended that investors confirm prices with their jeweler prior to acting upon the information.)

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