MCX gold futures fell on Thursday fell, taking cues from a lacklustre trade in the international market. While the US House passed the debt bill after the warring Democrats and Republicans arrived at an agreement, investors are eyeing the Federal Reserve’s Open Market Committee meeting scheduled later this month, before taking their calls on the precious metal.

At 1 pm, the August gold futures were trading at Rs 59,828 per 10 grams, down Rs 370 or 0.61% from Wednesday’s closing price. Meanwhile, July silver futures were trading at Rs 71,510 per kg, lower by Rs 592 or 0.82%.

Anuj Gupta, Vice President (VP), Commodity and Currency Research at IIFL Securities, said today’s correction was on account of profit booking by investors. He expects gold and silver futures to remain rangebound in the near term.

Fed funds futures predict a 62% chance of a 25 basis point raise at the central bank’s June meeting. Interest rate increases continue to be a drag on gold because they increase the opportunity cost of owning non-yielding metal. A general consensus among experts is on a 25 bps hike when Fed meets on June 13-14.

“We expect gold to trade higher towards 60,540 levels, a break of which could prompt the price to move higher to 60,700 levels,” Prathamesh Mallya, Deputy Vice President of Research, Non-Agro Commodities & Currency at Angel One said.

Gold futures on MCX have declined by 0.64% or Rs 381 per 10 grams in May, Gupta said. They are up by 8.88% or Rs 4,883 on a year-to-date basis as of Wednesday, he added. Meanwhile, silver futures have lost nearly Rs 445 or 0.60% in value terms in May while gaining by 3.36% or Rs 2,334 on a YTD basis, Gupta said.
The price of physical gold in Delhi and Ahmedabad is around Rs 61,000 per 10 grams while that of silver is Rs 72,500 per kg, Gupta of IIFL Securities said.Click to know more

Intraday Trading Strategy by Anuj Gupta

– Buy MCX June Gold futures at Rs 59,700 with a stop loss of Rs 59,450 and price target of Rs 60,300

– Buy MCX July Silver futures at Rs 71,000 with a stop loss of Rs 70,350 and price target of Rs 72,500.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)