Gold and Crude Oil - Aug 25, 2023 - HDFC Securities
Posted On:
2023-08-25 23:24:15 (Time Zone: IST)
By Mr. Saumil Gandhi, Senior Analyst - Commodities, HDFC Securities
Gold prices edged down on Friday. The spot gold price at Comex traded slightly lower by 0.01% to $1916 per ounce on Friday. While the gold October future contract at MCX is trading lower by 0.04% at Rs 58785 per 10 grams.
Comex gold prices retreated from a two-week high following strength in the dollar index and a hawkish remark from Fed member Harker. The dollar index traded near a two-month high and was on track for its sixth weekly gain. While Fed member Harker commented that although the U.S. central bank has raised interest rates high enough to bring inflation down, he doesn't see any chances of a rate cut anytime soon.
Investors focus now on today's key speech by the Federal Reserve Chair at the Jackson Hole symposium in Wyoming, where he's expected to offer clues on the interest-rate outlook. We expect gold prices to fluctuate in a narrow range before Federal Reserve Chair Powell's speech. Volatility will likely expand post-event. Comex spot gold has support at $1884 and resistance at $1945. The MCX Gold October future is expected to trade in a range of Rs. 58280 to Rs. 59080.
Crude oil prices traded higher on Friday, with the benchmark NYMEX WTI crude oil trading up by 1.0% at $79.97 per barrel against the previous close. Prices of oil are rising due to OPEC production cuts that have caused a substantial decline in global oil stockpiles over the last month. Additionally, news from Russia has boosted prices further, as the market's supply is suddenly beginning to slow down a bit. Russian fuel exports are heading for a 15-month low amid increased domestic demand.
We expect bullish momentum to continue in the oil price for the day. From a technical perspective, on the daily chart, the WTI crude oil price has formed a bullish reversal pattern. Until the price trades above the $77.80 level, traders should adopt a buy-on-dip strategy. NYMEX WTI Crude Oil has support at $77.80 and resistance at $81.70. The MCX crude oil September contract has support at Rs. 6480 and resistance at Rs. 6700.
