Gold and Silver Prices Surge in Domestic Markets

Domestic futures markets kicked off the week on a high note. February futures for gold increased by Rs 879, or 0.68%, reaching Rs 1,30,383 per 10 grams. Meanwhile, March futures for silver climbed significantly, hitting Rs 1,78,620 per kg, which is an increase of Rs 3,639 in early trading.

The rise in prices can be attributed to several factors: the weakening dollar, anticipation of interest rate cuts from the US Federal Reserve, and a falling rupee, which recently reached its lowest value against the dollar.

Looking at the international markets, silver slipped slightly from almost a three-week high during early Asian trading as investors began to secure profits amidst growing expectations for a U.S. interest rate cut. As for gold, it faced a marginal decline of 0.2%, settling at $4,221.68 an ounce at 0109 GMT, following its highest price since November 13 on Friday. Additionally, U.S. gold futures for December delivery rose by 0.2%, reaching $4,261.60 an ounce, while silver increased by 2.2%, resulting in a peak of $57.59 an ounce.

On Friday, both gold and silver closed positively within the domestic and international spheres. The February futures contract for gold settled at Rs 1,29,504 per 10 grams, showing an increase of 1.44%, while the March futures for silver settled at Rs 1,74,981 per kg, a notable rise of 5.42%.

Gold prices have risen to a five-week high, with silver reaching unprecedented levels, spurred by expectations surrounding a rate cut from the Federal Reserve and profit-taking initiatives influenced by the dollar index. Manoj Kumar Jain from PrithbifinMart Commodities Research noted that precious metals experienced safe-haven buying after disruptions at the CME due to overheating issues. The rupee’s decline against the U.S. dollar also contributed to this trend.

However, Jain pointed out that while there is optimism regarding a peace deal between Russia and Ukraine, it limited the gains in precious metals. He forecasted that, despite market volatility, gold could sustain a key level of $4,000 per troy ounce, and silver might hold a support level at $52.40 per troy ounce internationally.

In terms of market activity this week, Jain anticipated continued fluctuations in gold and silver prices due to potential shifts in the dollar index, global financial happenings, and the upcoming Fed monetary policy meeting.

Trading Recommendations for Gold and Silver

According to Jain, the trading range for gold and silver on MCX is as follows:

Gold: Support levels between Rs 1,28,200 to 1,27,700 | Resistance from Rs 1,30,300 to Rs 1,31,200

Silver: Support between Rs 1,72,500 to 1,69,600 | Resistance from Rs 1,78,800 to Rs 1,81,000

He suggests buying gold in the range of Rs 1,29,500 to Rs 1,28,800, with a stop loss below Rs 1,28,100 and a target between Rs 1,30,300 to Rs 1,31,200. For silver, a buying range of Rs 1,74,000 to Rs 1,71,000 is advised, with a stop loss below Rs 1,69,600, aiming for a target of Rs 1,78,800 to Rs 1,81,000.

Current Gold Rates in the Spot Market

Delhi: Standard Gold (22 carat) priced at Rs 94,928 for 8 grams | Pure Gold (24 carat) at Rs 1,02,176 for 8 grams

Mumbai: Standard Gold (22 carat) at Rs 94,944 for 8 grams | Pure Gold (24 carat) at Rs 1,02,192 for 8 grams

Chennai: Standard Gold (22 carat) at Rs 94,400 for 8 grams | Pure Gold (24 carat) at Rs 1,01,560 for 8 grams

Hyderabad: Standard Gold (22 carat) at Rs 94,576 for 8 grams | Pure Gold (24 carat) at Rs 1,01,768 for 8 grams