Gold and silver gain: Analysts see positive momentum on expectations of rate cut by US Fed

Gold prices on the Multi Commodity Exchange (MCX) opened on Tuesday at Rs 58,275 per 10 grams and hit an intraday low of Rs 58,265. In the international market, prices hovered around $1,921.85 per troy ounce. Meanwhile, silver opened on Tuesday at Rs 70,410 per kg and hit an intraday low of Rs 70,341 on the MCX. The price hovered around $22.91 per troy ounce in the international market.

Last Tuesday, Gold prices on the MCX opened at Rs 58,493 per 10 grams. In the international market, prices hovered around $1,927.65 per troy ounce. Meanwhile, silver opened at Rs 70,500 per kg on the MCX. The price hovered around $22.92 per troy ounce in the international market.

Anuj Gupta, Vice President of IIFL Securities, said, "Yesterday gold prices closed marginally higher by 0.16% 58,260 levels on the back of weakness in the dollar. Lower-level buying is emerging in the bullions due to the Federal Open Market Committee (FOMC) expecting a cut in interest rates. In the international market, it is trading at $1922 levels per ounce.

He sees technically strong support at 58000 levels and then 57700 levels, resistance at 58500 and then 58800 levels. Today, one can buy around 57900-58000 levels with a stop-loss of 57700 and for the target of 58500 to 58700 levels. Gold may test $1930 to $1935 levels in international markets.

Manav Modi, Analyst, Commodity and Current, MOFSL, said, "Gold traded steady in the early morning trade as traders cautiously await the U.S. Federal Reserve's minutes of the June meeting for more clues on its interest rate hike path ahead. U.S. manufacturing slumped further in June, with ISM's manufacturing PMI dropping to 46.0 last month, the lowest reading since May 2020, from 46.9 in May. Price pressures at the factory gate continued to deflate since bottlenecks in the supply chain have eased considerably and higher borrowing costs dampen demand. After the inflation data, which was reported 0.1% lower than expected, and hawkish comments from Fed officials, they continued to raise interest rate expectations. Investors see a 90% chance of a 25bps hike in July, according to CME's Fedwatch tool, bringing rates into the 5.25%-5.50%. Focus this week now shifts to the Services PMI from major economies and FOMC meeting minutes."