Market Price Overview
Gold began Monday slightly lower, with February futures trading at Rs 1,30,401 per 10 grams, a decrease of Rs 61 (0.05%) on the Multi Commodity Exchange
(MCX). This reflects traders' caution ahead of the U.S. Federal Reserve's monetary policy meeting this week. Silver futures also felt the pressure, with the March contract down by Rs 1,704 (0.93%), priced at Rs 1,81,704 per kilogram. Fluctuations in the dollar index contributed to this, though physical delivery shortages and a weaker rupee provided some support. On Friday, both gold and silver closed positively in the domestic market, but showed mixed results in international markets. The February gold futures settled at Rs 1,30,462 per 10 grams, increasing by 0.30%, while the March silver futures finished at Rs 1,83,408 per kilogram, with a gain of 2.96%. These movements highlight high price volatility, especially before the FOMC monetary policy meetings. Recent U.S. economic data was mixed, and the dollar index reached a 1-month low. The likelihood of Fed rate cuts supported prices. The US Dollar Index (DXY) was near the 98.89 mark, down 0.10 (0.10%).
Factors Affecting Prices
Several factors are currently impacting the gold and silver markets. The weakness of the rupee has supported metal prices in the domestic market. Physical delivery shortages and gains in base metals also sent silver prices to a record high. However, gold prices slightly decreased from their peak due to rebounding U.S. bond yields and a decrease in U.S. unemployment claims. Manoj Kumar Jain from Prithvifinmart Commodity Research highlighted that gold and silver could hold key support levels of $3,960 per troy ounce and $54.40 per troy ounce, respectively, in international markets. Jain expects the prices to stay volatile this week due to fluctuations in the dollar index, global financial markets, and upcoming Fed monetary policy meetings. The overall market sentiment is cautious, leading traders to watch the upcoming FOMC meeting closely. This wait-and-see approach contributes to the current price volatility observed in both precious metals.
Expert Price Outlook
Manoj Kumar Jain offered insights into potential trading ranges for gold and silver on the MCX. For gold, Jain identified support levels between Rs 1,29,740 and Rs 1,29,000, and resistance levels between Rs 1,31,200 and Rs 1,32,000. In the case of silver, support was seen at Rs 1,81,800-1,80,000, with resistance levels between Rs 1,85,500 and Rs 1,88,000. These price levels offer traders valuable guidance to manage risk and make informed decisions. Traders should also consider the broader macroeconomic factors such as dollar fluctuations, U.S. economic data, and anticipation surrounding the Federal Reserve's monetary policy decisions. Jain's analysis suggests that while short-term volatility is expected, these levels can assist in identifying potential entry and exit points for trading activities.
