Gold loses its glitter; some sheen for silver
The Iran-Israel conflict triggered some buying interest during middle of June, but it fizzled out soon. Lack of any meaningful trigger kept the gold price in check in June.
As a result, Comex gold closed almost unchanged at $3,315 at the end of June, representing a 0.06% fall. The performance of Comex silver was relatively better last month with the white metal gaining 9.8% to settle at $36.3 at the end of June.
Global markets lack sheen
Mirroring the trend in the global markets, MCX Gold price closed 0.2% lower to settle at ₹96,111 per 10-grams at the end of June.
MCX silver posted a much better performance, recording a 8.2% gain in June to settle at ₹1,06,325 per kilogram.
As anticipated last month, the price of Comex gold remained range bound and could not breakout out of the broad range of $3,120-$3,450 zone.
As observed last month, only a breakout from this zone would set the tone for the next big move. Until then, expect volatile price action within the $3,120-$3,450 zone.
Relative outperformance
After several months, silver displayed signs of relative outperformance in comparison to gold. Comex silver price managed to breakout above the upper end of the prior range of $30.5-$34.5. As mentioned last month, this breakout imparted upside momentum and the price scaled a high of $37.45 on June 18.
The short-term outlook for Comex silver is positive and the price could head to the next target zone at $39.5-$40.5. A fall below $34 would invalidate this positive outlook.
MCX gold was confined within the broad range of ₹91,000-₹1,00,100. A breakout from this range would trigger a strong move in the direction of the breakout. Above ₹1,02,000, the price could head to the next target zone of ₹1,08,000-₹1,10,000. On the other hand, a breach of the lower end of the range of ₹91,000 would push gold price lower to the next support zone at ₹85,500-₹86,000.
MCX silver price has settled comfortably above the psychological ₹1,00,000 mark since the beginning of June. The silver price has also crossed the upper end of the prior trading range, which is a sign of strength. The short-term outlook for MCX Silver is positive and the price could head to the next target at ₹1,16,500-₹1,18,500 zone. Only a fall below ₹1,01,500 would invalidate the positive outlook.
To summarise, gold is likely to remain range bound but silver looks relatively strong and could inch higher in the short-term.
(The author is a Chennai-based analyst / trader. The views and opinion featured in this column is based on an analysis of short-term price movement in gold and silver futures at COMEX & Multi Commodity Exchange of India. This is not meant to be a trading or investment advice.)
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