Fundamental News and Triggers

• The gold prices are firmly supported, trading over $2450 (Rs 70500) on geopolitical worries in the Middle East, with all eyes on US inflation figures. The Hamas group has opted not to engage in the discussions because its commanders do not believe the Israeli government is talking in good faith.
• The event raises the danger of a larger Middle East war and should act as a tailwind for the safe-haven metal amid speculations on further interest rate reduction by the Federal Reserve.
• The US Dollar is reaching its lowest level in almost a week, potentially benefiting gold as the emphasis switches to the US Consumer Price Index. The headline CPI is expected to fall from 3.0% year on year to 2.9% in July, while the core CPI is expected to climb by 3.2%, down from 3.3% in June.
• A poorer reading will increase betting on a 50-basis point Fed rate drop in September and impact the greenback, clearing the door for more rises in the precious metal.

 

Technical Triggers

• Gold continues its uptrend and is expected to soon touch new highs above $2500 (Rs 72000).
• Silver prices have been trading in a downward-slopping channel for the last three months after hitting a record high in May. $26.5 (~Rs 78000) is very strong support, which silver prices are maintaining, which is required to maintain an uptrend. The next resistance is $28 (Rs 81700).

 

Support and Resistance

 

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