Gold,Silver Prices

 

Gold, Silver prices in India on August 20: Gold price in India fell after for the second consecutive day on Thursday amid weakness in global markets, as a stronger US dollar made metals less attractive to holders of other currencies. Gold prices had fallen 4.5% in the previous week, registering its biggest decline since March amid appreciation in the US dollar.

The dollar index, which reflects the greenback's value against six leading Asian trading currencies, steadied at 93.042. The dollar rose 0.50% this morning after trading near two-year lows, as the Fed minutes downplayed the chances of change in interest rate policy until end-2021.

Share Market News Live: Sensex drops 350 points, Nifty at 11,320; ONGC, HDFC, L&T, ICICI Bank top laggards

Precious metals have been under mild pressure on risk appetite due to the US Federal Policy meeting minutes and sentiments stayed mixed after US Federal Reserve's cautious view of the economy. Comments highlighting uncertainties over the US recovery by Fed policymakers and lingering concerns over a US coronavirus stimulus bill have kept investors pessimistic.

Yesterday, both gold and silver spot slipped near by half a percent after sharp moves in previous session. On MCX gold too ticked lower, while silver lost more than 1%.

Gold price falls ahead of US Fed's policy meet outcome; silver rates at Rs 68,500

MCX

On the Multi-Commodity Exchange, gold September Futures traded 0.75% or Rs 395 lower at Rs 52,255, after hitting an intraday low of Rs 52,080 against the previous close of Rs 52,622 per 10 gm. MCX gold futures currently trade almost Rs 3,996 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 the 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.

Similarly, Silver September futures were trading Rs 470 lower at Rs 67,490 per kg today after they touched an intraday low of Rs 67,135 per kg. Silver Futures hit a lifetime high of Rs 77,949 on August 7.

Global markets

Market has been focusing the outcome of minutes from US Federal Reserve's policy meeting held on July 28 and 29. Recovering from a 3.6% tumble on Wednesday, Spot gold rose 0.51% to $1,939.28 per ounce Thursday as Fed members said additional easing may be needed because a rebound in employment was already slowing.

US gold futures fell 1.4% to $1,943 per ounce, while Comex gold was down .90% lower at $1,941 per ounce. Silver gained 0.8% to $26.94 per ounce.

Prices of the bullion metal fell upto 4.5% last week after the dollar had gained some ground and as US-China tensions continued to weigh on investor sentiment.

Amid the coronavirus-driven slowdown, fuelling fears of inflation and currency debasement, Comex gold has risen almost 36% to touch an all-time high of $2,063 per ounce hit on August 5, 2020, from lows of $1,517 per ounce, registered on 31 December 2019.

Gold vs Reliance Industries stock: Which has given better returns in 2020 so far?

Retail gold rate in India

24-carat gold prices in the national capital traded at Rs 56,570 per 10 gram. Price of 24-carat gold stood at Rs 56,250 per 10 gram in Chennai. In Mumbai,the rate for 24-Carat gold stood at Rs 52,990 as per Good Returns website.

Valuation

As per Geojit Financial Services, support of $1920 may hold the downside and expect an initial pullback. However, it need to stabilise above $1980 to continue bullish momentum. A direct drop below $1920 prices may target towards $1880 or even more.

For MCX Gold August, resistance is placed at 54,000 and support is at 51,400. For MCX Silver August futures, the resistance is at 71,500/74,980 and the support is placed at 65,100/60,800.

Commenting on Gold's outlook, Hareesh V, Head Commodity Research at Geojit Financial Services said," A weak US currency and expectations of more economic easing measures amid slow global growth continue to lift the safe-haven demand of gold. However, an intermittent profit booking cannot be ruled out on signs of easing US-China trade tensions and optimism about coronavirus vaccine."

On London spot technical outlook, he added," A direct break of $2020 is required to continue the bullish outlook, else intraday bias largely on the downside. However, major downside moves are likely only if prices break $1970."

Investors' interest in gold has risen ever since central banks globally embarked on unprecedented financial stimulus to combat the Covid-19 pandemic related economic headwinds. This has caused investors to use the bullion metal as a hedge against inflation and currency debasement.

Worldwide, there are 225 lakh confirmed cases and 7.91 lakh deaths from COVID-19 outbreak. Meanwhile, death toll in India crossed 54,000 mark and total coronavirus cases stood at 28.37 lakh as of Thursday.

Gold prices may hit Rs 65,000 level by Diwali; silver likely to touch Rs 90,000-mark