Gold futures for June delivery hit yet another record high of $1,569.8 an ounce on the Comex division of the New York Mercantile Exchange, as investors and traders the world over bought gold and silver as a safe haven hedge against the rising inflation. The June futures rose $61 last week to settle at $1,565.8 an ounce. We had indicated a price level of $1,525 in this column last week, and after facing resistance above $1,525 initially, they extended gains around $1,560. The June futures moved between support ($1,490) and resistance ($1,525) in the first three trading days, and breached to a record high on account of investment buying.
Technically, near-term resistance for the June futures is in the $1,560s. Support is seen at $1,523, $1,516 and $1,503. “We could fall back $20-$30 quickly on profit-taking, but I don’t see it going below $1,490s in the near-term,” said a technical analyst. Call option traders expect resistance above $1,575-1,580 in the near future. However, buying in the $1,600-strike call options, at an average premium of around $9 a contract, indicates that gold may breach the $1,600 mark. The put options data indicate support for the June futures around $1,540. On the Multi Commodity Exchange, the June futures are expected to move up afresh around 23,100, with strong support around 21,995, the MKTP chart suggests.
The strong upward trend seen in gold and silver this week is likely to spill over into next week’s trade as markets remain concerned about inflation. Technical analysts said markets posted strong weekly and monthly closes, boding well for the bulls.