Fundamental News and Triggers
- Gold held its longest streak of gains since February, driven by fears of a US economic downturn that have fueled haven demand, along with traders’ bets on lower interest rates.
- With a 90% chance of a cut, traders have placed bets on the Federal Reserve easing monetary policy at its next meeting in September in response to signs of weakness in the largest economy in the world. Bullion that does not pay interest is usually supported by lower interest rates.
- Gold has climbed nearly 30% this year as investors have sought safety amid heightened trade conflicts, geopolitical tensions and eroding trust in dollar-denominated assets. Still, the precious metal has been range-bound over the previous few months, lacking new catalysts to rocket over its record high of about $3500 an ounce hit in April.
Technical Triggers
- Gold has touched its resistance zone of $3440-50 (~Rs 101,350-500), so we might see some profit-booking up to $3390-3400 (~100,000). But if prices sustain above this resistance zone, we might see follow-through buying towards the next psychological level of $3500 (~Rs 103,000).
- Silver is holding up gains after taking support around $36.5 (~Rs 109,000). Upside momentum could continue towards $38.4(~Rs 114,000), taking clues from gold, while profit booking can drag prices to the support zone.
Support and Resistance
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