ECB rate hike gives support to precious metals

Fundamental Q News and Triggers

The European Central Bank raised interest rates to a record high as officials seek to confront excessive inflation in the eurozone, despite signs that the region’s economy is slowing. This elevated Dollar Index and Precious Metals prices to rebound and weaken Euro currency

Moreover, Gold is trading at a record $120 premium to world prices in China, indicating Beijing’s increasing effort to safeguard its yuan. Since rumours about gold import limitations began in June, investors have been buying domestic gold and selling overseas gold in an arbitrage transaction. The premium increase is also attributable to rather robust gold purchases in China.


Technical Triggers

Gold prices have rebounded after touching important support levels of $1920 (Rs 58300) and heading higher towards resistance of of$1960 (Rs 59100).

Silver prices gave a deadcat bounce after breaking the uptrend line at a touching low of Rs 70000. The next level to watch for is Rs 72300.

Support and Resistance




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