Gold Technical Report: Gold prices remained rangebound on Monday for second consecutive session. However, last week 10 days Exponential Moving Average @ 1944 crossed above 100 DMA @ 1936 and also posied to cross above 50days EMA @ 1948 hence further upside movement looks possible. If this happens with strong volumes, it will open room for further advancement upto the major psychological level of 2000. Main support level is near 200 days EMA @ 1875. The short term Stochastics Oscillator is at 90 (it is considered overbought when above 80 and oversold when below 20) and Relative Strength Index (RSI) is at 60 (it is considered overbought when above 70 and oversold when below 30).
Silver Technical Report: Silver prices witnessed some selling pressure but also recovered a bit from intra day low at the time of close. While giving 2 consecutive massive upmoves last week, it had also crossed above both 50 and 100 days EMA and hinted about fresh upmove. The main target now is 25.00 on closing basis, a major psychological level for silver and the main support is near 200 days EMA @ 22.60. The Short term Stochastics Oscillator is at 94 and Relative Strength Index near 67.
Fundamental Report: Last week, gold reached its highest level since June 16 after data revealed that U.S. consumer prices in June had the smallest annual increase in over two years. This led to speculation that the Federal Reserve might soon conclude its cycle of rate hikes. As a result, the yellow metal enjoyed a boost as the anticipation of further rate hikes diminished due to a decline in inflation. However, gold prices were capped on Friday as yields began to tick up.Next week, the market expects interest rate hikes from both the Federal Reserve and the European Central Bank. However, it is anticipated that the U.S. central bank will likely halt rate increases next year, while another hike is expected in Europe. Lower interest rates generally reduce the opportunity cost of holding non-yielding assets like gold. In addition to these factors, China, one of the top consumers of gold, reported sluggish economic growth of 0.8% in the second quarter compared to a 2.2% expansion in the previous quarter. This has led market participants to anticipate that Chinese authorities may introduce further stimulus measures to support economic growth. Overall, while gold prices experienced a slight dip due to a stronger dollar, market sentiment suggests that the Federal Reserve’s potential pause on interest rate hikes and other supporting factors such as declining inflation and central bank buying could contribute to further upward movement for gold in the short term.