How Bullion Brains Calculates: Methodology & Data Sources

Fair value starts from the global reference, COMEX gold or silver quoted in U.S. dollars per troy ounce. To compare it with a rupee-quoted MCX contract, the COMEX price is divided by 31.1035 grams per troy ounce, scaled to the local unit (10 grams for gold, 1 kilogram for silver), and converted at the USDINR exchange rate.

Import parity then layers landed costs on top of that converted price: customs duty, plus financing, premiums, and execution friction. The result is an estimate of what local bullion should cost if it simply tracked the cost of importing it. The basis — the observed MCX price minus this fair value — is what shows whether local metal is rich, cheap, or tracking.

Because the calculation is assumption-driven, the chosen duty and premium profile is always part of the read, and the freshness of each leg (COMEX, USDINR, and the local quote) is checked before the basis is trusted. A stale or estimated input downgrades confidence rather than producing a stronger opinion.

Positioning analysis is built from the weekly Commitment of Traders (COT) report published by the U.S. Commodity Futures Trading Commission, which splits COMEX gold and silver futures into trader categories: managed money, producers and merchants, swap dealers, other reportables, and nonreportables.

For each category, net position (long minus short) and its weekly change are read alongside open interest and price. The COT Index rescales a category's current net position to a 0-100 range over a chosen lookback, so positioning can be compared against its own history rather than read as a raw contract count.

The report is a lagged snapshot, not live data, and its categories organize positions without revealing intent. Crowding and concentration are treated as fragility context — where a squeeze could occur if price moves against the crowd — not as a timing signal.

Pivot levels are derived objectively from a completed period's high, low, and close. Classic floor pivots produce a central pivot with resistance (R1, R2, R3) and support (S1, S2, S3) levels; the Central Pivot Range (CPR) adds a top-central and bottom-central band that summarizes the prior session's value area. Fibonacci and Camarilla families space the surrounding levels differently.

These are reference zones, not instructions. A level being nearest or labelled R1 does not guarantee a reaction; pivots are read with current price behavior, confluence across timeframes, and event risk before they earn conviction.

Seasonal studies measure how a market has historically behaved across calendar windows. The output is never a claim that a month must be bullish or bearish; it is a ranked set of timing hypotheses qualified by sample size (how many occurrences), win rate (consistency), median behavior, and the spread between best and worst outcomes.

Indian bullion seasonality is heavily shaped by physical demand cycles — the wedding and festival calendar — layered on the dollar, real yields, and USDINR. A seasonal tendency is weighed against current conditions and macro context rather than traded on the calendar alone.

Correlation analysis measures how strongly assets have moved together over a chosen window, with each coefficient between -1 and +1. Rolling correlation recomputes that relationship across a sliding window so a trader can see whether a link has been stable or has drifted, rather than relying on a single static number.

Correlation measures historical co-movement in the selected sample; it does not prove causation, future continuation, or hedge safety. The chosen lookback is always part of the read.