Gold and Crude Oil - July 28, 2023 - HDFC Securities
Posted On:
2023-07-28 22:33:44 (Time Zone: IST)
By Mr. Saumil Gandhi, Senior Analyst - Commodities, HDFC Securities.
Gold prices traded up on Friday, with the spot gold price at Comex trading up by 0.20% at $1950 per ounce. Gold August future contract at MCX is trading higher by 0.25% at Rs 59130 per 10 grams.
Gold prices recovered after declining more than 1.30% in the previous session. Gold prices came under pressure following stronger than expected US second quarter GDP data, which signalled the US economy is doing well and possibly holding up to higher interest rates for a longer time. Second-quarter gross domestic product rose 2.4% at an annualized rate, more than in the first quarter, adding more uncertainty to the outlook for the rate path as Fed Chair Powell reiterated that additional tightening would depend on incoming data.
Today's recovery was driven by bargain buying, but the short-term outlook remains moderately bearish after Comex gold was unable to cross the key resistance level of $1987/oz. One should avoid buying until prices trade below this resistance level. On the flip side, the gold has first support at $1940, then $1925. The MCX Gold August future has support at Rs 58600 and resistance at Rs 59580.
Crude oil prices traded flat on Friday after surging more than 1.0% in the previous session, with the benchmark NYMEX WTI crude oil trading up by 0.04% at $79.80 per barrel against the previous close. A strong US macroeconomic outlook and indications of a tighter market lifted oil prices towards a fifth consecutive weekly gain. Fears of a U.S. recession, which may have hampered oil demand this year, were allayed after data showed the second quarter's GDP expanding faster than anticipated.
Crude oil prices remained range-bound in the first half amid mixed fundamentals, but we believe in the second half, oil prices will remain bullish as fundamentals improve significantly. From a technical perspective, NYMEX WTI crude oil has short-term resistance at $83.40 and support at $77.50. The MCX Crude Oil August contract has resistance at Rs 6700 and support at Rs 6420.
