Fundamental News and Triggers

• Following the U.S. and China’s agreement to significantly reduce tariffs, gold fell to its lowest level in almost a month, although it slightly recovered yesterday as a result of ongoing uncertainty surrounding the direction of trade talks.
• Because of the modest April CPI miss, the US dollar is under less pressure, and tariffs have less immediate effect. The April US inflation report was marginally weaker than what market participants had anticipated monthly.
• The World Gold Council reports that gold ETFS saw net inflows of 115 tons in April, the biggest monthly rise in more than three years and the fifth consecutive month. Nearly 65 tons of these inflows came mostly from China.

Technical Triggers

• Gold prices may drop to $3200 (~Rs 92000) if they remain below $3265 (~Rs 94000) this week. And we are expected to see a $200 decline from those levels up to $3000 (~Rs 86000) if prices break and hold below $3200, which is the Double Top formation’s neckline support.
• Silver prices are expected to get momentum now, as the tariff war has de-escalated. We are likely to see prices touching $34(~Rs 99000) and $35(~Rs 102,0000) soon in the coming days.

Support and Resistance

 

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