By Ravindra Rao
MCX Gold April future has witnessed strong support near the Rs 44200 zone as it has reversed its losses and closed above the 5 day EMA at 44750 on a couple of occasions. Moreover, price is hovering above the midline of the intermediate regression channel, which has supported the rebound in gold price. Meanwhile immediate resistance for April futures exists around Rs 45200, followed by Rs 45740 (21 Day EMA) and key support holds around Rs 44200. The strength index RSI (35) has reversed from the oversold zone. Furthermore positive divergence between RSI and price also strengthened the recovery in gold price. For the day, price is expected to move in the band of Rs 44200-45200 with sideways to positive bias. Only a close above Rs 45200, would extend its gains further towards Rs 45750.
Strategy:
Buy MCX Gold April at Rs 44600 with a target price of Rs 45200 and a stop loss at Rs 44200.
MCX Silver May future witnessed quick recovery from the key support zone of Rs 65800-65700 (78.6% Fibonacci retracement level). Meanwhile, key resistance for May future exists around Rs 68200 (Top of the Doji Candle), which also coincides with the 21 day EMA Rs 68050. On the downside, Rs 65800 and Rs 64800 holds major supports. On the momentum form, RSI is trading around 50(46) suggesting sideways trend. For the day, price is expected to move in the range of Rs 65800-68200 with sideways bias. Only a sustained move out of the range could bring more clarity on the direction of Silver prices.
Strategy:
Buy MCX Silver May at Rs 65800 with a target price of Rs 68200 and a stop loss at Rs 64800.
(Ravindra Rao is VP-Head Commodity Research at Kotak Securities)