Weekly Outlook on Gold - 28-July-2022

Weekly Outlook on Gold - 28-July-2022
Weekly Outlook on Gold - 28-July-2022

by Sachin Gupta Last Updated: 2022-07-29T17:05:22+05:30 IST

Gold prices traded higher consecutive third day in a row amid speculation that the Federal Reserve will slow the pace of interest rate hike at some point. The prices rallied more than 1.5% on a weekly basis, supported by the weaker dollar and declining US Treasury yields. 
The U.S. Fed reserve raised interest rate by 75 basis points on Wednesday and also released U.S. GDP data on Thursday fell at a 0.9% in the second quarter, which lifted bullion’s safe-haven appeal. 
 

Weekly Outlook on Gold -28-July-2022

 

According to the World Gold Council, the demand for Gold jewelry may shrink due to weaker economic growth in the top consuming market, like China and India. As China’s energy crises & struggling real-estate sector may cause a slow recovery in demand. While, another top consumer India may also see lower buying due to fall in Rupee and higher import duty.  
Technically, COMEX Gold has pulled back from the immediate support of $1678 levels on a weekly chart and managed to sustain above $1740 levels, which was the prior swing highs, acting as a resistance zone for the Gold. Now, on the daily chart, the price has sustained above 21-Days Simple Moving Averages. On the downside, the Gold has support at $1720 & $1678, while resistance is at $1785 / $1820 levels.
On the domestic front, MCX Gold prices gained sharply after the Fed outcome and GDP data and managed to close above 51000 marks. On the daily time frame, the price has surpassed the resistance of 50800 with the higher volume that suggests bullish signals for the near term. The price has moved above 50 SMA that supports the bullish momentum. A momentum indicator RSI (14) is hovering above 50 levels, indicating positive strength in the prices. A Vortex indicator also suggests the positive crossover and VI+ shows upside moves for the coming week. 

So based on the above aspect, we are expecting a bullish move in MCX Gold future for the coming week. A follow up move above 51000 could pull the prices towards 51800/52300 levels. However, on the downside, 50500 would act as an immediate support for the counter. Traders are advised to follow buy on dips strategy for the coming week and also keep an eye on below important release. 

Important Data:

ISM MANUFACTURING PMI

USD

BOE MONETARY POLICY REPORT

GBP

TRADE BALANCE

USD

NON-FARM EMPLOYMENT CHANGE

USD

Important Key Levels: 

 

MCX GOLD (Rs.)

COMEX GOLD ($)

Support 1

50500

1720

Support 2

50200

1678

Resistance 1

51800

1785

Resistance 2

52300

1820

Start Investing in 5 mins*

Get Benefits worth 2100* | Rs. 20 Flat Per Order | 0% Brokerage

Start Investing in 5 mins*

Get Benefits worth 2100*

Rs. 20 Flat Per Order| 0% Brokerage

About the Author

Mr. Sachin Gupta is a Senior Research Analyst at 5paisa, based in Mumbai. He has over 10 years of experience in Equity, Commodity research and strategies. 

Disclaimer

Investment/Trading is subject to market risk, past performance doesn’t guarantee future performance. The risk of trading/investment loss in securities markets can be substantial. Also, the above report is compiled from data available on public platforms.
SENSEX
59,462.78
130.18 (0.22%)
17,698.15
17,698.15
39.15 (0.22%)
39,042.30
39,042.30
162.45 (0.42%)

Open Free Demat Account

& get benefits worth 2100*

 
Resend OTP
Please Enter OTP
  • Have Promo code?
  • Use code ACT2100
Enter Promo code

By proceeding, you agree to the T&C.

SENSEX
59,462.78
130.18 (0.22%)
17,698.15
17,698.15
39.15 (0.22%)
39,042.30
39,042.30
162.45 (0.42%)

Start Investing Now!

Open Free Demat Account in 5 mins

Enter Valid Mobile Number