Gold prices on the MCX, international markets and the local jewellers were absolutely flat on Monday June, 28. This was in line with the trend we have seen in the last few days in the precious metal.
Gold for August delivery was little changed at Rs 49,650, marginally up by 0.09%, while gold in the international markets too was flat at $1779.70 an ounce, up 0.105. Spot gold in the Indian markets was also flat.
In Bangalore 22 karats gold was around that Rs 44,120 per 10 grams mark, while in Chennai spot gold for 22 karats was Rs 44,470 per 10 grams. In Mumbai spot gold for 22 karats was Rs 46,170 per 10 grams on Monday.
Gold in the Indian markets follows international prices, which in turn move on bond yields, economic data and comments by the US Fed on interest rates.
Amit Khare, AVP- Research Commodities, Ganganagar Commodities says, " The Fed has for years (pre-pandemic) used 2% percent as their inflation target. During the pandemic, they altered their mandate to let inflation run hot or above 2% and instead focused on boosting employment in the United States. However, the current PCE index is roughly double the Federal Reserve's target of 2%. The Bureau of Economic Analysis revealed that U.S. inflation rose sharply in May. It showed that prices are rising at their fastest pace since 2008. The PCE climbed 0.4% in May, which takes the annual PCE inflation rate to 3.9%.
The momentum indicators are turning up, and a base appears to have been forged around $1,773. A move above $1,800 is needed to confirm the bottom. Initial target $1,820 (38.2%) of June 's decline and $1,833 (~200-day moving average). U.S. 10-year yield stalled at 1.50%, Another bullish signal is that bitcoin is not seeing a renewed rally after briefly falling below $30,000 and erasing all the year-to-date gains this week."
According to Sandeep Matta, Founder, TRADEIT Investment Advisor, sideways sideways consolidation is likely to continue until it closing above Rs 47, 500 levels. He says that key level for GOLD AUG Contract is Rs 46,991 and the Buy zone would be above - 46995 for a target of Rs 47150-47329.
"The sell zone below Rs 46,991 for the target of 46775-46613," he says.
Gold prices have fallen a bit since the US Fed indicated that there could be interest rate hikes in the US as early 2023. In fact, the Fed indicated that there could be two hikes by the end of 2023 as inflation continues to rise.