Gold and Silver - August 27, 2021 - Reliance Securities
2021-08-28 19:29:57 (Time Zone: IST)
Mr. Sriram Iyer, Senior Research Analyst at Reliance Securities
Markets recovered this week supported by a small fall in the dollar.
Moreover, rising coronavirus cases could drive expectations that the U.S. Federal Reserve might delay tapering of economic support and lent support to gold.
Data from IHS Markit showed U.S. business activity growth slowed for a third straight month in August as capacity constraints, supply shortages and the rapidly spreading Delta variant weakened the momentum of the rebound from last year's pandemic-induced recession and lent support to bullion.
However, investors refrained themselves from taking large positions as the Jackson hole Symposium Event started this week as investors looked ahead to the eagerly awaited speech from Fed Chair Jerome Powell's speech.
Ahead of the speech by Jerome Powell, hawkish comments by two regional Federal Reserve presidents suggested a faster pace of reducing the U.S. central bank's asset purchases kept upside capped.
The key trigger for prices over the next few days will be tonight's speech by Fed Chair Jerome Powell.
There is a remote possibility that the Fed chair may not announce anything in his speech on Friday and could make an announcement at the September meeting after the awaiting the August non-farm payroll number in the 1st week of September.
However, a more cautious tone will be dovish for the dollar and further aid bullion and vice versa.
Markets could also look to cues the August non-farm payroll number due next week.
On the charts, ahead of speech, LBMA spot gold could remain within the range $1785 to 1810/ounce. Breakout on either side will provide fresh ranges. Important supports below $1785 are $1777 and $1769 and a break below both supports will pull prices to $1745 levels. On the other hand, important resistance above $1810 are $1817 and $1833 and a break above both resistances will push prices to $1845 levels.
On the domestic front, MCX October could remain within the range Rs. 47550/10 gram to Rs. 47250/10 gram. Breakout on either side will provide fresh ranges. Important supports below Rs. 47250 are Rs. 47000 and Rs. 46750 and a break below both supports will pull prices to Rs. 46500 levels. On the other hand, important resistance above Rs. 47550 are Rs. 47800 and Rs. 48000 and a break above both resistances will push prices to Rs. 48300 levels.
For Silver, LBMA spot prices key support is at $22.60 levels and a break below could pull to $21.75. on the upside, resistance is at $24.00 level and a sustained trade next week will be waited for further upside movement up to $24.70.
MCX Silver September supports are at 62245 and 61230. Resistances are at 63880 and 64600.
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