Gold Price Today, 6 Feb- Gold tanks globally, dollar firms on fears of continued rate hikes; MCX gold rises

Gold Price Today, 6 Feb: Gold tanks globally, dollar firms on fears of continued rate hikes; MCX gold rises

Gold Price Today, Gold Price Outlook, Gold Price Forecast: Gold rate is trading higher on Monday despite negative global cues, while the silver rate is up 0.12%. On Multi Commodity Exchange, gold April futures were trading at Rs 56,887 per 10 grams, up Rs 302 or 0.53%. Silver March futures were trading higher by Rs 302 at Rs 67,696 per kg on MCX.

Globally, the yellow metal hit a four-week low as the dollar strengthened on fears of continued interest rate hikes from the US Fed. Spot gold was little changed at $1,865.88 per ounce after hitting its lowest level since Jan. 6 earlier in the session. U.S. gold futures rose 0.2% to $1,879.40. The dollar index was 0.2% higher, making gold less attractive for buyers holding other currencies, according to Reuters.

The readings spurred fears that the Fed has enough economic headroom to keep raising interest rates, which fuelled a recovery rally in the dollar and Treasury yields. We expect gold and silver to remain volatile in today’s session. Gold has support at $1851-1840 while resistance is at $1878-1890. Silver has support at $22.20-22.00, while resistance is at $22.62-22.85. In INR terms gold has support at Rs 56,320-56,160, while resistance is at Rs 56,870, 57,150. Silver has support at Rs 67,150-66,620, while resistance is at Rs 68,050–68,480.

Gold witnessed profit booking from highs: Manav Modi, MOFSL

Gold prices dropped over 2%, to a more than three-week low after stronger than expected U.S. jobs data raised fears that the Federal Reserve could keep hiking interest rates. After a sharp rise in both gold and silver prices, profit booking was witnessed from the highs which was coupled with strong jobs data and rebound in dollar index. US employment growth accelerated sharply in January, with 517,000 positions added, almost double the gain in December. The unemployment rate hit more than a 53-1/2-year low of 3.4%, pointing to a persistently tight labour market.

After this data, US 10 Year Yields traded higher, along with the dollar index which from the lows of 100.80 it is trading around 103.20. In the last Fed policy meeting, a 25 bps rate hike was announced with a less hawkish tone, however a tight jobs market data comments from Fed officials scheduled this week w.r.t further Fed’s stance will be very important to watch for. Focus this week will also be on the RBI policy meeting and Governor Powell’s speech. Broader trend on COMEX could be in the range of $1855-1895 and on domestic front prices could hover in the range of Rs 56,500-57,200.

Near-term outlook on gold remains bearish: Deveya Gaglani, Axis Securities

MCX Gold posted a worst weekly drop of more than 1 percent in the last 3 months, and it settled around Rs 56,500 due to better-than-expected Non-farm payroll data that led to a swift recovery in the Dollar index and a pick-up in Treasury yields. Non-farm payrolls came at 517K against the forecast of 193K. The positive data print from the USA brought a high degree of uncertainty regarding the Federal Reserve’s next move that the Central bank will soon end the tightening cycle that dented Precious Metals’ appeal. The dollar index recovered swiftly from the lows of 101.5 up to the 103 level which bulldozed precious metals from 52 week high. Precious metals prices are highly sensitive to interest rate hikes and the Dollar index. A strong support zone in Comex Gold is seen around $1750 and resistance is around the $1920 level. The near-term outlook remains bearish for Gold as long as the price is trading below $1920 on a weekly basis.