By Tapan Patel
Commodity rates traded mixed with most of the commodities in the non-agro segment witnessed recovery from decrease levels throughout the week. Bullion rates rebounded from current lows supported by a weaker dollar. Crude oil and base metals reported firm trading variety halting declines outweighing increasing COVID instances worries.
Gold rates traded larger with spot gold rates at COMEX ended up by .95% to $1780 per ounce for the week witnessing a sturdy recovery from “flash crash”. Gold October futures at MCX rose by .64% at Rs 46,940 per 10 gram along with rupee depreciation. The spot rupee ended about .12% weaker against the dollar for the week. Gold ETF holdings witnessed outflows as holdings at SPDR Gold Shares fell to 1022 tonnes from the prior week’s 1025 tonnes for the week. The CFTC information showed that cash managers decreased their net lengthy positions by 55649 lots in last week.
Silver rates declined with spot silver rates at COMEX fell by 2.39% to $23.75 per ounce for the week. MCX Silver September futures fell by 2.71% to Rs 63,238 per KG. Silver rates traded beneath stress on weak base metals and decrease demand outlook. Prices pared some loses in last trading day with recovery in gold rates and base metals. The CFTC information showed that cash managers decreased their net lengthy positions by 13994 lots in last week.
Bullion rates witnessed sturdy recovery in the last 3 trading days of the week supported by a weaker dollar. The important increase in rates came on deteriorated US customer sentiment in spite of of enhanced job market place. U.S. customer sentiment fell in early August to the lowest level in practically a decade as Americans grew more concerned about the economy’s prospects, inflation and the current surge in coronavirus instances. The valuable metals got assistance from dollar decline and fall in US treasury yields. The US 10 year treasury yields ended at 1.286% even though the dollar index fell by .30% to 92.52 for the week. Bullion rates may perhaps additional add threat premium more than increasing worries more than rapidly-spreading Delta variant across the globe.
We count on gold rates to trade larger in the coming week with COMEX spot gold resistance at $1810 per ounce and assistance at $1750 per ounce. At MCX, Gold October rates have close to term resistance at Rs 47,500 per 10 grams and assistance at Rs 46,400 per 10 gram. COMEX silver spot has close to term resistance at $24.60 per ounce with assistance at $22.90 per ounce. MCX Silver September has crucial resistance at Rs 65,800 per KG and assistance at Rs 61,800 per KG.
(Tapan Patel is a Senior Analyst (Commodities) at HDFC securities. Views expressed are the author’s personal. Please seek advice from your economic advisor just before investing.)