By Ravindra Rao
Gold and silver prices were trading with minor cuts in Thursday’s session, tracking the trend in international markets, as US stimulus talks again derailed. Here is a trading strategy for the bullion counters:
MCX GOLD has been trading in a rising wedge with support pegged at Rs 50,700. In yesterday’s session, the price tested the upper bound of the wedge near Rs 51,500. The price has been making higher highs and higher lows indicating short term bullish momentum. Immediate resistance is seen near Rs 51,550-51,600 as per the rising wedge. Break might give bulls further wedge. Momentum Oscillator is above the midline supporting the bull case.
- Buy MCX Dec Gold at Rs 51,000
- Target at Rs 51,550; Stop loss at Rs 50,800
MCX SILVER made a spinning top formation near the trend line resistance of Rs 64,150 which is also a double top zone, indicating a strong supply zone. Immediate support is placed at Rs 62,250 followed by Rs 61,650. Relative strength index (RSI) is at 50, suggesting equilibrium between the bulls and bears.
- Sell MCX Dec Silver at Rs 63,500
- Target Price at Rs 62,350; Stop loss at Rs 64,150
(Rao is VP-Head commodity Research, Kotak Securities)