A day after jumping up to 2%, MCX gold and silver prices declined on profit-taking in morning deals on Thursday, 23 July, as rising crude oil prices, driven by the US-Iran conflict, fueled expectations of US Federal Reserve monetary tightening.
MCX gold August contracts were 0.32% down at ₹1,45,207 per 10 grams, while MCX silver September futures were 0.23% down at ₹2,26,474 per kg around 9:05 am.
In the previous session, the MCX gold August futures contract jumped 2%, and the silver September futures contract clocked a gain of nearly 1.5%.
US gold futures declined about half a per cent to trade near $4,115 per troy ounce on Thursday after touching a two-week high of $4,171 per troy ounce in the previous session.
Gold and silver prices declined as oil prices jumped over 2% to their highest in more than six weeks, as the US continued its airstrikes on Iran, while Iran-backed Houthis target oil tankers in the Red Sea.
The September contract of the international crude oil benchmark, Brent crude, traded over $96 per barrel on Thursday morning.
The dollar index rose to 101.13 but later eased slightly, still trading near 101 and weighing on gold prices.
Middle East tensions show no signs of abating, as US President Donald Trump said Iran is not ready to make a deal yet, even as the US military launched fresh strikes on Iran’s military government and infrastructure sites.
Amid rising geopolitical risks, investors await next week’s monetary policy decision of the US Federal Reserve. The Fed is expected to keep rates unchanged on 29 July, but expectations of rate hikes this year remain strong.
“Investors await next week’s Federal Reserve meeting. While policymakers are expected to keep rates unchanged, markets continue to price in the possibility of a rate hike later this year, with traders seeing a 61% chance of an increase in September,” said Jigar Trivedi, Senior Research Analyst at IndusInd Securities.
Gold and silver prices: Key levels to watch
Ravi Singh, Chief Research Officer at Master Capital Services, underscored that MCX gold witnessed strong buying interest and reclaimed the 55-day EMA, indicating an improvement in the near-term trend.
He said that the recovery from recent lows suggests bullish momentum is gradually strengthening, with prices now attempting to reclaim the 21-day EMA. The short-term outlook has turned positive, and the preferred strategy has now shifted to buy on dips.
“On the downside, ₹1,43,000 will act as the immediate support, followed by a stronger support near ₹1,40,000. As long as prices hold above these levels, gold may attempt to move towards the ₹1,47,800 mark in the coming sessions,” said Singh.
Manoj Kumar Jain of Prithvifinmart Commodity Research said MCX gold has support at ₹1,44,400 and ₹1,43,350, and resistance is at ₹1,46,800, followed by ₹1,48,000, while silver has support at ₹2,24,400 and ₹2,22,000 and resistance is at ₹2,29,100 and ₹2,31,000.
“We suggest long-term investors must hold their long positions in gold and silver, but traders can book profits in every market rise in gold around ₹1,47,000 and ₹1,48,000 range and in silver around ₹2,31,000 and ₹2,33,000 range,” said Jain.
Trivedi expects MCX gold August futures to drift lower initially to ₹1,45,000 per 10 grams. However, he believes it may rebound to ₹1,46,000 as the session progresses.
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Disclaimer: This article is for educational purposes only and does not constitute investment advice. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
