Bias remains negative for MCX Gold, Silver futures; Key levels to watch out

The MCX Gold futures may slide towards the 200-DMA at Rs 48,840 in the near term; while the broader trend indicates a downside target of Rs 53,000 for MCX Silver futures.

4 min read Last Updated : May 16 2022 | 9:42 AM IST

Gold
Bias: Consolidation likely to continue
Last close: Rs 49,909
Resistance: Rs 50,265
Downside Potential: Rs 48,840

The MCX Gold June futures as anticipated at the start of the month dipped below the Rs 50,000-mark as selling pressure outweighed the buying support. In the process, the commodity closed below its 100-DMA (Daily Moving Average) for the first time since February 7, 2022.

The price-to-moving averages action continues to remain moderately in favour of the bears, as Gold prices are currently trading below the 20-DMA, 50-DMA and 100-DMA. The next logical support for Gold futures now seem to be the 200-DMA placed at Rs 48,840-odd level.

According to the key momentum oscillators, the MACD (Moving Average Convergence and Divergence) has been languishing below the Zero line since the start of this month. The Slow Stochastic and the ADX (Average Directional Index), however, indicate lack of strength in the current direction. Thus, MCX Gold prices may consolidate in the near term, albeit with a negative bias.

The immediate hurdle for MCX Gold is currently its 100-DMA placed at Rs 50,265-odd level. In case, Gold manages to sustain above the 100-DMA, the commodity may rally towards its 20-DMA placed around Rs 51,350-odd level.

According to weekly Fibonacci chart, MCX Gold June futures this week may move in a broad range of Rs 48,850 to Rs 50,970. MCX Gold futures may seek support around Rs 49,530 - 49,255 - 49,050; whereas on the upside, the Gold prices are likely to face resistance around Rs 50,285 - 50,565 - 50,770.

Meanwhile, as per the daily Fibonacci chart, the MCX Gold June futures on Monday are likely to seek support around Rs 49,780 - 49,620 - Rs 49,550; on the upside the commodity may face resistance around Rs 50,035 - 50,130 - 50,265.

Similarly, Gold Mini June futures are likely to move in a broad range of Rs 48,940 to Rs 51,000 this week. Gold Mini futures may look to seek support around Rs 49,610 - 49,335 -49,140, whereas may face resistance around Rs 50,340 - 50,610 - 50,810.

On Monday, MCX Gold Mini June futures may look for support around Rs 49,850 - 49,760 - 49,630; whereas the commodity may face resistance around Rs 50,095 - 51,190 - 51,320.

Silver
Bias: Negative
Last Close: Rs 59,382
Resistance: Rs 62,135
Support: 56,630
Downside Potential: Rs 53,000

The MCX Silver July futures continued to trend lower as the overall bias remains negative for the commodity. The MCX Silver futures have now been trading below all their its key moving averages for the last 12 trading sessions. The 20-DMA, which was already below the 50-DMA and 100-DMA has now also slipped below the 200-DMA, thus highlighting the strength on the downside.

However, select momentum oscillators like the MACD and the Slow Stochastic in particular have hit the oversold zone on the daily charts. Hence, a pullback rally in the near term cannot be ruled out in Silver prices.

In case of a pull-back rally, the commodity can jump back towards Rs 62,000-level, above which the first real test would be around the 20-DMA at Rs 63,750-odd level.

The weekly charts of MCX Silver indicates' that the commodity is currently testing the support around its lower-end of the Bollinger Band at Rs 58,300-odd level. As long as Silver futures are able to sustain above the same, a pull-back rally can materialise.

Having said that the broader trend on the on the weekly charts also remains negative with a downside potential target of Rs 53,000 - which is where the 200-WMA (weekly Moving Average) currently stands.

According to the weekly Fibonacci chart, this week the MCX Silver July futures are likely to trade in a broad range of Rs 56,630 to Rs 62,135; with support expected around Rs 58,400 - 57,680 - 57,155. On the upside, Silver futures may face resistance around Rs 60,360 - 61,085 - 61,610.

The daily Fibonacci charts, indicates key support levels for Silver futures on Monday at Rs 59,100 - 58,740 - 58,585; whereas resistance can be expected around Rs 59,665 - 59,875 - 60,180.

Similarly, MCX Silver Mini June futures may seek support around Rs 59,465 - 59,265 - 58,975; while may face resistance around Rs 60,210 - 60,355 - 60,500 on Monday.

Further, the MCX Silver Micro June futures could seek support around Rs 59,450 - 59,250 -58,955 and might face resistance around Rs 60,195 - 60,340 - 60,485 today.