Gold and Crude Oil - June 20, 2023 - HDFC Securities

By Mr. Saumil Gandhi, Senior Analyst - Commodities, HDFC Securities.

Gold prices traded firm on Tuesday, with the spot gold price at Comex trading marginally up by 0.07% at $1953 per ounce. The gold August future contract at MCX was trading higher by 0.20% at Rs 59295 per 10 grams by noon.

Gold prices are stuck in a choppy range as investors are looking for more cues on the macro front. Comex spot gold prices struggled to sustain above the $1960/oz level on the back of expectations of a higher interest rate and the strength of the US dollar. The Federal Reserve paused interest-rate increases last week but indicated more hikes are on the table and that rates will go higher than previously expected. Tomorrow's Fed Chairman Jerome Powell's testimony should be the next major trigger for volatility in the markets.

For the day, we expect range-bound trading to continue in precious metals. The Comex gold price has immediate support at $1939 per ounce and resistance at $1970 per ounce. MCX Gold August future has support at Rs 59080 per 10 gram and resistance at Rs 59570 per 10 gram.

Crude oil prices edged higher on Tuesday, with the benchmark NYMEX WTI crude oil trading up by 0.35% at $71.87 per barrel. Crude oil prices recovered from earlier losses and traded positive as investor sentiment improved after China lowered its one-year loan prime rates amid efforts to boost a slowing recovery. Meanwhile, data on Tuesday showed that China's oil imports from Russia jumped to a record high in May, suggesting demand improved from the world's second-largest oil consumer.

On the technical front, NYMEX WTI crude oil has first resistance at $72.30 if price crosses this level, then the rally will extend towards the $74.08 level (100-day SMA). On the flip side, the area around $70.80 acts as strong support for the day. MCX Crude Oil July contract resistance is at Rs 6080, and support at Rs 5820 acts as support.