Gold price in India saw huge drop on Friday, highest in a week. On the Multi-Commodity Exchange (MCX), October gold contracts tanked 0.22 per cent to Rs 47,498 for 10 grams at 1400 hours on August 5. Silver also dropped on Friday. The precious metal future fell by 0.26 per cent to Rs 66,826 on August 6. In the international market, gold edged lower on Friday, driven by the stronger dollar. Investors will be keenly watching US jobs report for cues on the Federal Reserves future policy stance.
Gold prices continued to feel the effects of the hawkish comments by a US Federal Reserve officials for early tapering of the central banks asset purchases ahead of a key jobs report. Stronger data also weighed on prices. The number of Americans filing new claims for unemployment benefits declined further last week, while layoffs dropped to their lowest level in just over 21 years in July as companies held on to workers amid a labour shortage. Initial job claims for state unemployment benefits fell 14,000 to a seasonally adjusted 385,000 for the week ended July 31. Reflecting investor sentiments, holdings of SPDR Gold Trust fund edged lower to 1,027.61 tonnes on Thursday from 1,027.97 tonnes on Wednesday," said Sriram Iyer, senior research analyst at Reliance Securities.
International spot gold and silver prices have started in the red this Friday morning in Asian trade as the dollar held gains ahead of the much-anticipated US jobs data, while a growing number of Federal Reserve officials signalled the possibility of a sooner-than-expected policy tightening. Technically, LBMA Gold below $1810 level could see a Bearish momentum up to $1795-$1788 levels. Resistance is at $1811-$1820 levels. Technically, LBMA Silver holds a resistance of 21-Daily Moving Average at $25.65 below which could see a downside move up to $25.00-$24.30 levels. Resistance is at $25.50-$25.90 levels," Iyer added.
Domestic gold and silver prices could start in the red this Friday morning, tracking overseas prices. On the domestic front, MCX Gold October is holding resistance near Rs 47,800-48,000 levels. Support is at Rs 47,500-47,400 levels. On the domestic front, MCX Silver September holds a resistance Rs 67,700-68,200 levels. Support is at Rs 66,300-65,900 levels," he further added.
Even with prices languishing in a narrow trend, the gold market continues to build a solid base in July, seeing a modest uptick in investor inflows into gold-backed exchange-traded funds (ETFs), according to the latest report from the World Gold Council. In its monthly global ETF monitoring report, the WGC said that 11.1 tonnes of gold flowed into global ETF in July, with the value of assets under management increasing to $669 million, up +0.3% from the previous month.The report said that total ETF demand currently stands at 3,636 tonnes, down only 7?low the record levels reported in October. Although the gold market continues to see healthy investment demand, the WGC said that the inflows haven t been enough to reverse the weakness reported in the first quarter of 2021," said Amit khare, AVP, research commodities, Ganganagar Commodities Limited.
Todays release of the US Labor Departments jobs report for July will be an important component that will shape and determine adjustments to the current monetary policy of the Federal Reserve. Gold and Silver are trading near oversold zone as per hourly chart, momentum indicator RSI also indicating some positive sign on daily chart. So one short covering is pending in bullions, traders are advised to create fresh long position in Gold and Silver, traders should also focus important technical levels given below for the day: August Gold closing price 47,603, Support 1 - Rs 47,350, Support 2 - Rs 47,100, Resistance 1 - Rs 47,850, Resistance 2 - Rs 48,200. September Silver closing price Rs 66,998, Support 1 - Rs 66,400, Support 2 - Rs 65,800, Resistance 1 - Rs 67,570, Resistance 2 - Rs 68,400," he added.