MCX Gold rose for a sixth consecutive day in , heading for its biggest weekly gain in almost four months, as a weaker dollar and rising energy prices spurred investors to buy the metal as a haven from inflation. Silver also gained.
The dollar is down 1.5 percent this week against a basket of six major currencies, and crude oil rebounded after tumbling 3.5 percent Thursday .
Gold futures for August delivery fell 50 cents to $903.70 an ounce on the Comex division of the New York Mercantile Exchange, snapping a five-session rally. The metal climbed 3.5 percent this week.
Silver futures for July delivery dropped 7.3 cents, or 0.4 percent, to $17.397 an ounce. The metal rallied 5.1 percent this week, erasing last week's loss. The price has advanced 17 percent this year, while gold climbed 7.8 percent.
Gold often moves in line with the euro, with bullion gaining 8.2 percent this year and the euro advancing 6.9 percent. Crude- oil futures rose in New York on a report that Israel rehearsed bombing nuclear facilities in Iran, OPEC's second-largest producer. China, the world's second-biggest energy consumer, will raise gasoline and diesel prices as much as 18 percent today.
Precious metals are a traditional hedge for investors when currencies decline and costs accelerate. Gold priced in the euro, yen and pound also reached records this year as central governments lowered or kept borrowing costs steady because of the threat of a global slowdown.
India spot gold rose over 1.6 percent on Friday on inflation fears and firm international cues, wholesale price index, the widely watched inflation tracker, rose to 13-year highs at 11.05 percent for the week ended June 7 from 8.75 percent a week earlier on a recent rise in retail fuel prices
U.S.Economy:
The International Monetary Fund said the U.S. economic slump has been shallower than estimated and warned the Federal Reserve may have to raise interest rates ``quickly'' to contain inflation.
U.S. consumer prices rose more than forecast in May on record oil prices, and confidence among Americans slumped to the lowest level since Jimmy Carter occupied in the White House. The consumer price index increased 0.6 percent, the most since November, after a 0.2 percent gain the previous month
U.S. stocks slid to a three-month low, led by consumer and technology companies, as threats of increased violence in the Middle East sent oil prices higher and analysts said demand for electronics may weaken
Currencies update:
The dollar was headed for its biggest weekly decrease against the euro in almost three months on speculation the Federal Reserve will delay increasing borrowing costs to prevent further credit market writedowns.
The Australian and New Zealand dollars headed for weekly advances on speculation the countries will maintain their yield advantage over the U.S. The target lending rates of 7.25 percent in Australia and 8.25 percent in New Zealand compare with the 2 percent fed funds target.
The pound fell against the euro after Bank of England Deputy Governor John Gieve said U.K. house prices will extend their slide, denting consumer confidence.
MCX Gold June - Technical Outlook:
The daily stochastic have crossed over up which is a bullish indication. The stochastic indicators are rising from oversold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.
Technical are neutral to signaling sideways to lower prices in the near term. Initial support for the market is around 12459 levels. if broken can see further fall to 12383 and 12240 If market holds above 12592 further rally can be seen towards 12658 and 12701
Recommendations–MCX Gold Aug: Sell at 12575 Target 12510 and 12440 Stoploss at 12625
MCX Silver July - Technical Outlook:
The daily stochastic have crossed over up which is a bullish indication. The stochastic indicators are rising from oversold level, which is bullish and should support higher prices. The market's short-term trend is positive as the close remains above the 9-day EMA. The downside closing price reversal on the daily chart is somewhat negative.
Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 24330 levels. If broken can see further fall to 24153 and 23946 however If market holds above 24625 further rally can be seen towards 24714 and 24921
Recommendations-MCX Silver July: sell at 24635 Target 24450 and 24330 stoploss at 24755
