Outlook, trading strategies for gold & silver

By Ravindra Rao

Gold
MCX gold prices managed to close above the minor high of Rs 51,450, indicating strength on the upside. Immediate resistance is placed at Rs 52,200, while support exists around Rs 50,720 (Bollinger middle band ) followed by Rs 50,350. The relative strength index (RSI) is at 58.86, indicating the gains for the bulls over the bears.

Strategy

• BUY MCX Gold Dec at Rs 51,000
• Target Rs 51,650; Stop loss Rs 50,700

Silver
MCX silver price volatility (ATR) has risen, suggesting bigger moves. The supply zone is in the Rs 64,000-64,200 range. Likewise, the immediate support is at Rs 61,100, followed by Rs 60,000. However, the momentum indicator (RSI) is hovering above 50 signifying a mild bullish trend. Closing above Rs 64,300 will give an upside momentum.

Strategy

• BUY MCX Silver Dec at Rs 61,100
• Target at Rs 63,000; Stop loss at Rs 60,500

(Rao is VP-Head Commodity Research, Kotak Securities)