Gold prices significantly declined during the morning trade session in the domestic futures market on Tuesday, May 21, amid subdued demand from spot markets and weak global cues.

Gold in international markets eased from its record-high levels as the US dollar dented the bullion’s safe-haven appeal. Since gold is priced in dollars, the rise of the US currency makes it expensive to buy in other currencies.

Also Read: Gold and silver prices today on 21-05-2024: Check latest rates in your city

Investors were cautiously awaiting the minutes of the Federal Reserve’s last policy meeting to be released on Wednesday. Lately, rate cut hopes have been one of the biggest drivers of gold prices. Geopolitical tensions, sticky inflation and macroeconomic uncertainties have also helped gold to hit record highs this year.

In the domestic market, MCX Gold for June 5 delivery traded 0.64 per cent down at ₹73,892 per 10 grams around 11:20 am.

Also Read: Silver prices up 18% year to date, can jump to ₹92k mark in 3 months; should you prefer silver to gold for investments?

What should be your strategy for bullion?Experts expect gold prices to remain volatile in the near term.

Kaynat Chainwala, senior manager of commodities research at Kotak Securities, pointed out that COMEX Gold prices pared gains after touching a fresh all-time high of $2454.2 per troy ounce on Monday. A slew of hawkish comments from Fed officials prompted markets to rethink the rate cut trajectory.

Fed Vice Chair Philip Jefferson said on Monday it was too early to tell if the inflation slowdown is “long lasting,” while Vice Chair Michael Barr said restrictive policy needs more time, Chainwala pointed out.

“A soft US inflation print last week saw traders pile into bets on a potential September rate cut. Today, investors might pay attention to Fed officials’ speeches for more cues on the policy path amid the lack of economic data,” said Chainwala.

Also Read: ‘Perfect storm’ steers gold to another record high; silver jumps

Manoj Kumar Jain of Prithvifinmart Commodity Research expects gold and silver prices to remain volatile this week ahead of the Fed meeting minutes.

He, however, believes gold and silver could hold their support levels of $2,360 and $30.40 per troy ounce, respectively, on a weekly closing basis.

“Gold has support at $2,422-2,400, while resistance at $2,454-2,470 per troy ounce and silver has support at $32.10-31.70, while resistance is at $32.74-33.10 per troy ounce in today’s session,” said Jain.

“On the MCX, gold has support at ₹74,040-73,800 and resistance at ₹74,660-74,920, while silver has support at ₹94,350-93,500 and resistance at ₹96,100-97,200,” Jain said.

Jain suggests buying gold on dips around ₹74,000, with a stop loss of ₹73,650 and a target of ₹74,700.

Brokerage firm Motilal Oswal Financial Services expects MCX Gold to trade in a range for the session.

“Support for MCX Gold is placed at ₹73,500-73,250, whereas resistance is at ₹74,000-74,350,” said Motilal Oswal.

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Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.

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