Gold prices corrected in the Indian market on May 4 as a stronger dollar and Federal Reserve Chair Jerome Powell’s comments that the US economy was poised for strong growth but would need the bank’s support weighed on the yellow metal. Silver, too, was trading lower by 0.38 percent.

On MCX, June gold futures were trading at Rs 47,220 for 10 grams, down Rs 99, or 0.21 percent, at 1015 hours. The metal hit a high of Rs 47,314 and a low of Rs 47,210 after opening at Rs 47,226. July silver futures were trading at Rs 70,628 per 10 gram, down by Rs 272 or 0.38 percent,

Gold and silver prices made hit a nine-week high on May 3 amid perceived bargain buying, weakness in the dollar index and soft 10-year benchmark bond yields.

June gold futures contract settled at $1791.80 a troy ounce with a gain of 1.31 percent and July silver futures contract settled at $26.96 a troy ounce, gaining 4.05 percent.

The metals also settled on a positive note in the domestic markets. June gold June futures contract settled at Rs 47,319, gaining 1.25 percent and July silver futures contract ended at Rs 70,900 a kilogram, up 3.71 percent.

The dollar index slipped again and 10-year benchmark yields also dipped to 1.61 percent and supported both the precious metals.

“As per the latest data release from the United States, Institute of Supply Management (ISM) momentum in the manufacturing sector slows down slightly and supports prices of both the precious metals,” Manoj Kumar Jain, Director, Head – Commodity & Currency Research at Prithvifinmart Commodity Research told Moneycontrol.

In the international market, gold futures were trading at $1,788.30, down 0.2 percent, as the dollar index, which measures the value the American currency against of a basket of world’s leading six currencies, rose 0.22 percent to 91.12 in the morning.

Gold is inching closer to test $18,00 in the international markets, Jain said. The ISM said its manufacturing index showed a reading of 60.7 percent for April, down from March’s 64.7 percent.

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“The data missed expectations as consensus forecasts were calling for a reading of around 65.0 percent. On the other hand, the record rise in coronavirus cases in India and Japan also supported safe-haven buying in precious metals,” he said.

Silver July futures in the morning traded at Rs 70,628 per 10 gram, down by Rs 272 or 0.38 percent, while in the international markets, silver corrected 0.35 percent to trade at $26.86 per troy ounce.

Jain expects both the metals to remain volatile on May 4 and continue holding it’s support levels. “Gold is having support at $1,778-1,766 per troy ounce and resistance at $1,800-1,822 per troy ounce; silver has support at $26.60-26.20 per troy ounce and resistance at $27.20-27.60 per troy ounce,” he said.

On MCX, “gold is having support at Rs 47,100-46,880 and resistance at Rs 47,550-47,700; silver is having support at Rs 70,400-69,800 and resistance at Rs 71,400-71,900 levels”, Jain added.