Understanding the Factors Affecting MCX Gold Prices Today
3 min read
What to Consider for MCX Gold Today
The gold market has seen significant movement recently, with prices hitting record highs in international markets. This surge can be attributed to ongoing geopolitical tensions and concerns over inflation. As an investor, it is important to stay informed and develop a strategy that takes into account these factors.
Current Market Trends
Gold prices have witnessed decent gains in the domestic futures market, following positive global cues. MCX gold for June 5 delivery traded 0.44% higher at ₹71,652 per 10 grams. Additionally, silver prices have also risen to their three-year peaks in international markets.
Factors Influencing Gold Prices
Several factors are contributing to the rise in gold prices. Strong central bank buying, safe-haven inflows amidst geopolitical risks, and demand from momentum-following funds have all played a role in the 14% gain in bullion so far this year.
Furthermore, the potential for US inflation prints on Wednesday could impact gold prices. If the US Consumer Price Index (CPI) for March rises to 3.4% year-on-year, and the core CPI slows to 3.7%, it may boost the prospects of earlier-than-expected Fed rate cuts. However, recent strong US macro data and comments from Fed officials have indicated that rate cuts could be delayed.
Developing Your Strategy
When considering your strategy for gold today, it is important to keep a few key factors in mind. Experts suggest that gold prices could remain supported by underlying positive sentiment. However, investors should closely monitor US inflation data and the minutes of the Fed’s March monetary policy meeting.
Rahul Kalantri, VP of Commodities at Mehta Equities, highlights the prevailing market sentiment, which is bolstered by robust safe-haven demand amid geopolitical tensions. Additionally, global central banks continue to exhibit strong demand for gold as part of the ongoing trend of de-dollarization.
Manoj Kumar Jain of Prithvifinmart Commodity Research expects gold and silver prices to remain volatile this week due to fluctuations in the dollar index, geopolitical tensions, US inflation data, and monetary policy meeting minutes. However, he believes that gold and silver could hold their support levels of $2,260 and $26.40 per troy ounce, respectively, on a weekly closing basis.
In terms of technical analysis, Jain suggests that gold has support at $2,345-2,320, with resistance at $2,374-2,388 per troy ounce. Meanwhile, silver has support at $27.66-27.30, with resistance at $28.30-28.64 per troy ounce. On the MCX, gold has support at ₹71,000-70,660 and resistance at ₹71,600-71,950. Silver has support at ₹81,800-81,100 and resistance at ₹83,200-84,000.
Based on this analysis, Jain recommends buying silver on dips around ₹81,800-81,500 with a stop loss of ₹80,750. The target for this trade is ₹83,200-84,000.
Conclusion
As an investor, it is crucial to stay informed about the latest developments in the gold market. Taking into account factors such as geopolitical tensions, inflation data, and central bank demand can help you develop a strategy that aligns with the current market trends.
Remember, market conditions can change rapidly, so it is important to regularly reassess your strategy and make adjustments as needed. By staying informed and keeping a close eye on market indicators, you can make well-informed decisions when it comes to investing in MCX gold.
