Gold, Silver and equity market strategy: Key levels highlighted for traders

CapitalVia Global Research highlights that the International Gold and Silver prices are trading on the weaker side owing to reports of strong U.S. Treasury Yields and U.S. dollar. Replacement of Turkey’s central bank head with a high interest rates critic has led to financial instability, resulting in the downfall of yellow metal. Technically, International Gold is traded with bearish momentum, where resistance is at $1755-$1745 levels. Prices are sustaining above support of $1720-$1725.

On the domestic front, MCX Gold April opened on a flat note and declined more than 300 points in the morning session. Prices rose from the minor support of Rs 44650 – Rs 44600 levels and may test Rs 44800 – Rs 44900 levels on the upside after which we could expect bearish momentum to continue in the upcoming session.

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Like Gold, International Silver also traded with bearish momentum and tested the support of $26.6- $26.3 levels. We may expect prices to rise from these levels. MCX Silver May gave a gap down opening and declined more than 1500 points in the morning session. Prices may rise a little in the upcoming session after which we could expect bearish momentum to continue.

The Nifty witnessed a day of consolidation. After a swift recovery in March 19, the Nifty traded in a range bound manner and closed marginally in the red. The key hourly moving averages acted as a stiff resistance and restricted a further upmove. Going ahead Sharekhan expects the Nifty to continue with the positive momentum towards the upper boundary placed at 15000. The Nifty is likely to gain momentum once it sustains above the resistance zone of 14760- 14800. On the downside, 14580-14620 shall act as a support zone for the Nifty.

Other technical observations:

On the daily chart, the Nifty is below the 20-day moving average (DMA) and the 40-DEMA, of 14890 and 14738, respectively. The momentum indicator is bearish on the daily chart. On the hourly chart, the Nifty is between the 20-hour moving average (HMA) and the 40-HEMA, of 14646 and 14760, respectively. The hourly momentum indicator is bullish. The market breadth was positive with 1065 advances and 893 declines on the National Stock Exchange.