Markets

Gold, silver fell most since Nov. 2016 in June

Precious metals lost sheen in June, recording the worst monthly performance since November 2016. The strengthening U.S. dollar, along with the firm trend in equity markets affected sentiment towards precious metals. Reports that the U.S. Federal Reserve will start tapering bond purchases and their decision to raise interest rates in 2023 also played a part in keeping the prices depressed.

Comex gold lost 7% to close at $1,771.8 an ounce. Comex silver lost 6.5% to settle at $26.19 an ounce. Mirroring the global trend, MCX gold futures fell 5.1% to ₹46,839 per 10 gm. MCX silver futures closed 5.5% lower at ₹69,074 per kg.

Comex gold price remained subdued in June. The short-term outlook for gold remains weak. The price is likely to fall to the immediate target of $1,710-1,715 range. A fall below $1,710 would impart momentum to the fall and the price could then test the next target zone at $1,650-1,660.

This outlook would be under threat if the price closes above the immediate resistance at $1,830-1,840. Until this resistance zone is taken out, there would be a case for a slide to $1,710 and lower.

The short-term outlook for Comex silver, too, is weak and the price can fall to the immediate target at $24.5-25.10 range. This outlook would be invalidated if the price moves above the resistance level at $28.70-29.50. Till $29.5 is breached, there would be a strong case for a slide to $25.1 or lower. MCX gold too closed on a weak note in June. The short-term outlook is negative and the price could fall to the immediate target zone at ₹44,500-45,000. This view would be invalidated if the price rises above the resistance level at ₹49,200-49,600.

The near-term outlook for MCX silver, too, is negative. It may slide to the immediate target of ₹64,000-64,500. This would be invalidated if the price moves above ₹72,500-73,000. A close below ₹68,000 would strengthen the case for a slide to ₹64,000 and lower.

(The writer is a Chennai- based analyst/trader. This is not meant to be trading or investment advice)


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Printable version | Sep 21, 2021 9:02:55 AM | https://www.thehindu.com/business/markets/gold-silver-fell-most-since-nov-2016-in-june/article35127638.ece

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