Gold and Silver rate today (June 7, 2024): Yellow metal trades steady at Rs 73,124, silver eases after previous days sharp gains

Gold and Silver rate today (June 7, 2024): Domestic yellow metal futures traded mildly higher even as gold prices in the international markets are on course for their first weekly gain in three amid rising bets that the US central bank will cut rates sooner, leading to a decline in the dollar index and treasury yields. 

At the last count, MCX gold August futures contract traded with a cut of 0.01 per cent or Rs 7 at Rs 73,124, after having scaled to Rs 73,516 per 10 gm at the day's high. Similarly silver future July contract traded with a discount of 0.08 per cent or Rs 78 at Rs 93,738 per kg.

Gold and silver continued their upward momentum following the ECB's decision to cut interest rates and a decline in U.S. bond yields. Globally, interest rate expectations are falling. On Wednesday, the Bank of Canada (BoC) reduced its overnight rate to 4.75 per cent from 5 per cent, and on Thursday, the European Central Bank (ECB) cut its main refinancing rate by 0.25 per cent to 4.25 per cent.

The U.S. 10-year bond yields plunged after the ECB rate cuts, and the dollar index also slipped from its highs, which supported gold and silver prices. 

Meanwhile, traders await a key US jobs report due later today that’s likely to guide the interest rate outlook at the Federal Reserve. The report is expected to show that the US added 180,000 jobs in May while the unemployment rate held steady.

"We expect gold and silver prices to remain volatile in today’s session ahead of the U.S. job report and fluctuations in the dollar index," said Rahul Kalantri, VP Commodities, Mehta Equities. 

Meanwhile, COMEX gold in the international market was up 0.07 per cent at $2,392.5 per ounce.

Gold has support at $2351-2335 and resistance at $2391-2405. Silver has support at $30.82-30.67 and resistance at $31.32-31.50. In INR, gold has support at Rs 72,880-72,650 and resistance at Rs 73,340-73,550. Silver has support at Rs 93,250-92,680 and resistance at Rs 94,470-95,150, added Kalantri.

Outlook for Gold

Gold remains supportive amid softer-than-expected non-farm payrolls data which could increase the odds of rate cuts by the Federal Reserve. Data from the Chicago Board of Trade (CBOT) shows that traders expect 39 basis points (bps) of interest rate cuts toward the end of 2024 via the December fed funds rate futures contract. According to the CME FedWatch Tool, traders are currently pricing in a 57% chance of a rate cut in September, noted Neha Qureshi, Senior Technical and Derivative Research Analyst at Anand Rathi Commodities & Currencies.

How do technicals look for Gold?

Technically Gold had extended its rally this week after consolidation with buyers cracking the top of the range that had opened the door for further gains. As major technical indicators remain bullish, adding Qureshi, momentum remains on the buyers side. Meanwhile the dollar bull narrative which was seen in the start of the year has now reversed since last month which could be running short of arguments for the next leg higher remaining positive for gold from a medium term perspective and could even propel gold to new highs in the coming weeks.

Trading strategy in gold and silver for June 7, 2024

Qureshi recommends a 'buy on dips' in MCX Gold August contract at around Rs 73,100 for a target of Rs 73,700, keeping a stop loss at Rs 72,600, while for the Silver July contract she suggests a buy on dip at around Rs 93,800 for a target of Rs 95,800, keeping a stop loss at Rs 92,800.

Here's a list of indicative spot gold prices in some of the major cities in the country: 

City-wise gold rate (24k) in India (June 7, 2024)

(Disclaimer: These are indicative prices collected from trusted sources. Investors are advised to check prices with their jeweller before acting on the information.)

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