Gold and Silver Prices (September 12): Gold prices traded marginally higher reflecting gains in international markets and soft US Consumer Price Index. At around 11:20 am, MCX Gold (October) futures were trading 0.09% or Rs 67 higher at Rs 71,994 per 10 grams, while December Silver futures were trading 0.53% or Rs 450 higher at Rs 84,900 per kg.
Traders reduced long positions following the US inflation data as it increased the likelihood that the Federal Reserve (Fed) will kick off an easing cycle with a 25 basis points (bps) rate cut.
COMEX Gold traded at $2,546.1 per ounce, up slightly by 0.15%.
Monthly headline inflation was unchanged, but monthly core inflation, which excludes food and energy, rose 0.1 percentage point.
Market participants pushed up U.S. Treasury yields on concerns that the Fed may refrain from cutting interest rates by 50 basis points (bps) next week and opt for a 25 bps cut instead. The 10-year Treasury rose 1.5 bps to 3.655%. The U.S. dollar strengthened on the news, hitting an intraday high of 101.82 according to the U.S. Dollar Index (DXY). At the time of writing, the DXY was roughly flat at 101.68.
Gold Outlook
Neha Qureshi, senior technical and derivatives analyst at Anand Rathi Commodities & Currencies, said gold may get ahead of the ECB’s interest rate decision as jobless claims numbers provide further clues on the state of the US labour market.
Ahead of key macro factors, gold prices are generally expected to remain above $2,500 per ounce in intraday trade, however, extreme macro positioning for the metal remains persistent and risks remain in place for the coming days which could lead to liquidation in case of a drop below $2,490 on the downside, Qureshi added.
Gold Trading Strategies
Experts have recommended buying MCX Gold (October) futures around Rs 71,900 on the dip, keeping a target price of Rs 72,300 and a stop loss at Rs 71,500. Meanwhile, for MCX Silver (December), analysts have again recommended buying around Rs 84,400 on the dip, keeping a target price of Rs 86,400 and a stop loss at Rs 83,400.
