Gold and silver prices today: Yellow metal rises sharply by 1.14%, silver up 0.64%

Gold prices opened on the Multi Commodity Exchange (MCX) on Wednesday at Rs 59,767 per 10 grams and hit an intraday low of Rs 59,765. In the international market, prices hovered around $1,977.67 per troy ounce. Meanwhile, silver opened at Rs 76,176 per kg and hit an intraday low of Rs 76,156 on the MCX. The price hovered around $25.04 per troy ounce in the international market.

Anuj Gupta, Vice President of IIFL Securities, said, "As expected, yesterday gold prices increased sharply by 1.14% and closed at 59794 levels because of weak data released in the U.S. market and safe-haven demand of gold and silver increased. Yesterday, we noticed that U.S. industrial production and capacity utilisation data [were negative]."

Weak data put pressure on the U.S. dollar index. The dollar index is trading at 99.60 levels. Experts expect the FOMC to keep interest rates unchanged, which will be positive for bullion. Gupta said, "We expect the dollar index may further go down and may test 99 to 97 levels. In the international market, it is trading at $1977 levels per ounce."

He sees technically strong support at 59400 levels and then 59000 levels, Resistance at 59900, and then 60300 levels. Today, one can buy on dips around 59300-59400 levels with a stop-loss of 59100 and for the target of 59900 to 60000 levels. Gold may test $1990 to $2000 levels in international markets.

Gold rose over 1% to a more than one-month high, bolstered by a softer dollar and lower Treasury yields, with investors betting that recent U.S. economic readings make the case for a pause in the Federal Reserve’s interest rate hikes.

Manav Modi, Analyst, Commodity and Currency, MOFSL, said, "The dollar index continued to hover close to its 15 month lows; while benchmark Treasury yields ticked lower for the second straight day. On data front, U.S. retail sales rose less than expected in June, increasing 0.2% last month, against the expectations of 0.5%; consumer spending, however, appeared to be solid. US Industrial production data was also reported weaker than expectations supporting an up-move in bullions."

Along with gains in gold, industrial metals also inched higher supporting the move in silver. According to CME Fed-Watch tool, there is still more than 95% probability of a 25 bps rate hike in June meeting, however amidst weaker data market participants are discounting that this could be the last hike in the Fed's tightening cycle. "Market participants will keep an eye on the CPI data from UK and EU and a few housing numbers from the U.S.," said Modi.

Amit Khare, associate vice president at Ganganagar Commodity Limited (GCL), said, "MCX Gold and Silver gave positive closing yesterday. August Gold closed at 59763(1.07%). September Silver closed at 76103(0.64%), Bullions daily charts are now showing some profit booking, and Momentum Indicator RSI is also indicating the same, so traders are advised to book profit in longs and can create fresh short positions in Gold and Silver near given residence level one with the stop loss of resistance level two and book near given support levels: Gold August Support 59500/59200 and Resistance 59900/60200. Silver September Support 75400/75000 and Resistance 76400/77200."