Bias negative for MCX Gold below Rs 50,500; Silver faces multiple hurdles

On the downside, near support for Gold futures seen at Rs 49,860, below which re-test of Rs 48,900-level seems likely; Silver futures face an uphill task of conquering multiple hurdles on the upside.

Despite the sharp pull-back in Gold prices, the overall bias for MCX Gold October futures remains negative. The contract needs to sustain above Rs 50,500-level for the bias to turn favourable. On the other hand, Silver futures have managed to sustain above the 20-DMA for the last three weeks. While, the bias seems tentatively positive, the contract has an uphill task of conquering multiples hurdles on the upside.

Gold

Bias: Negative

Last Close: Rs 50,027

Support: Rs 49,860; Rs 48,900

Resistance: Rs 50,500; Rs 51,100

Despite the sharp 3.5-per cent rally in the latter half of last week, the overall bias for MCX Gold October futures remains negative. Even though, Gold prices climbed above the 20-DMA (Daily Moving Average), the price-to-moving averages action continues to favour the bears.

The overall bias to turn favourable Gold prices will need to above the 200-DMA, i.e. Rs 50,500-level on a consistent basis. For now, the 20-DMA at Rs 49,860, can offer some support, below which re-test of the lower-end of the Bollinger Band on the daily chart at Rs 48,900-odd level seems likely.

Among the key momentum oscillators, the 14-day RSI, MACD and the Slow Stochastic are marginally in favour of the bulls on the daily chart, while the same remain negative on the weekly chart.

As per the weekly Fibonacci chart, this week MCX Gold October futures may trade in a broad range of Rs 48,980 to Rs 51,085. The contract is likely to seek support around Rs 49,650 - Rs 49,375 - Rs 49,170, and whereas may face resistance around Rs 50,400 - Rs 50,680 - Rs 50,880. 

On Monday, MCX Gold 1 kg futures contract could seek support around Rs 49,860 - Rs 49,740 - Rs 49,560, while on the upside the October contract is likely to face resistance around Rs 50,190 - Rs 50,315 - Rs 50,405.

Similarly, MCX Gold Mini October futures are likely to seek support around Rs 49,955 - Rs 49,910 - Rs 49,840, and the contract may face resistance around Rs 50,085 - Rs 50,130 - Rs 50,200 today.

Silver

Bias: Tentatively Positive

Last Close: Rs 56,868

Resistance: Rs 57,880; Rs 58,800

Support: Rs 56,070; Rs 55,930

Despite alternate bouts of volatility, the MCX Silver futures have managed to sustain above the 20-DMA for the last three trading weeks, and further the 20-DMA placed at Rs 55,930 is now on the verge of overcoming the 50-DMA at Rs 56,070. The crossover could aid the tentatively positive sentiment at the counter.

However, the in the last three weeks, Silver futures have been unable to conquer its next hurdle placed at Rs 57,880 - the 100-DMA. Break and trade above the 100-DMA can trigger an up move towards the 58,800 and Rs 61,300 - the higher-end of the Bollinger Band on the daily chart and the 200-DMA.

For now, the bias shall be tentatively positive, as long as Silver prices hold above Rs 55,900, below which a fall to Rs 53,170 seems likely. On the upside, the December Silver contract needs to clear the multiple hurdles mentioned above.

According to the weekly Fibonacci chart, this week the MCX Silver December futures are likely to trade in a broad range of Rs 55,550 to Rs 58,190. The Silver contract is likely to seek support around Rs 56,340 - Rs 56,050 - Rs 55,800. On the upside, Silver futures may face resistance around Rs 57,370 - Rs 57,685 - Rs 57,935.

On Monday, Silver futures may support around Rs 56,465 - Rs 56,345 - Rs 56,220, while on the upside the commodity could face resistance around Rs 57,270 - Rs 57,390 - Rs 57,515.

Similarly, MCX Silver Mini November futures could seek support around Rs 56,890 - Rs 56,775 - Rs 56,660; while the Mini contract may face resistance around Rs 57,640 - Rs 57,755 - Rs 57,870 on Monday.

Further, the MCX Silver Micro November futures could seek support around Rs 57,025 - Rs 56,915 - Rs 56,800 and might face resistance around Rs 57,775 - Rs 57,865 - Rs 57,980 today.