MCX Gold likely to test Rs 54,000-level; Silver can dip to Rs 61,200

In case of a pullback, the immediate resistances for Gold and Silver futures are placed at Rs 56,050 and Rs 64,580, respectively.

The MCX Gold and Silver futures have declined 5.8 per cent and over 13 per cent from their respective peaks registered on February 02, 2023, so far. While, Silver futures have been trending with a negative bias for quite some time now, Gold futures too have now dipped below key moving averages.

The next significant supports for the Gold and Silver prices stand at Rs 54,000 and Rs 62,000. On the upside, the short-term moving averages are likely to act as resistances.

Gold

Bias: Negative

Last Close: Rs 55,432

Target: Rs 54,000; Rs 52,400

Support: Rs 55,300

Resistance: Rs 56,050; Rs 56,700

The MCX Gold futures have now witnessed considerable profit-taking from its recent peak of Rs 58,826 touched on February 02, 2023. Gold prices have declined by 5.8 per cent in the said duration, and are now seen trading below the 50-DMA (Daily Moving Average) for the first time in almost a year.

As per the daily chart, Gold futures are trending alongside the lower-end of the Bollinger Bands at Rs 55,300-odd level. Sustained trade below the same can push Gold futures towards the next significant support levels placed at Rs 54,000 and Rs 52,400 in the form of 100-DMA and 200-DMA.

In case of a bounce back, the 50-DMA at Rs 56,050 and the 20-DMA at Rs 56,700, are likely to act as resistances.

On the weekly scale, the MCX Gold April futures are likely to test support around the 20-WMA (Weekly Moving Average) placed at Rs 54,100-odd level. In case this support holds, we have witness a period of consolidation and pullback in Gold prices thereafter.

The key momentum oscillators on the daily and weekly chart are indicating a mixed bias, with clear negative cues seen on the daily scale, few positives on the weekly. Thus, it seems possible that Gold prices may witness some volatility in the near-term as both bulls and bears look to take control.

Accordingly to the weekly Fibonacci chart, this week, the MCX Gold April futures could swing in the range of Rs 54,800 to Rs 56,050; with support expected around Rs 55,050 - Rs 54,925, and resistance likely on the upside around Rs 55,655 - Rs 55,940.

On Monday, the MCX Gold April futures contract is likely to seek support around Rs 55,275 - Rs 55,225 - Rs 55,180, while on the upside the contract may counter resistance Rs 55,590 - Rs 55,640 - Rs 55,685.

Similarly, the MCX Gold Mini March futures are expected to find support around Rs 55,420 - Rs 55,380 - Rs 55,345, and on the upside the contract could meet resistance around Rs 55,650 - Rs 55,690 - Rs 55,725 today.

Silver

Bias: Negative

Last Close: Rs 63,433

Target: Rs 61,200; Rs 57,500

Support: Rs 62,000

Resistance: Rs 64,580; Rs 66,780

The negative bias on the Silver futures since February 10, 2023, seems to be taking a toll on the prices. Silver March futures have crashed over 13 per cent from its high of Rs 72,769 touched on February 02, 2023. The commodity is now seen trading below its 20-, 50- and 100-DMAs.

Silver futures are seen trading below the 100-DMA for the first time since October 2022. The overall bias for Silver remains negative on the basis of price-to-moving averages action.

Not only, is the commodity trading below key moving averages, but also the 20-DMA is below the 50-DMA, which adds to the significant negative bias.

On the downside, Silver futures seem headed towards the 200-DMA placed at Rs 61,200-odd level. Whereas on the other hand, the 100-DMA at Rs 64,580 could act as an immediate hurdle, above which the next significant hurdles are placed at Rs 66,780 and Rs 68,000.

On the weekly scale, Silver futures have breached the 20-WMA (Weekly Moving Average) placed at Rs 64,630 and the 100-WMA at Rs 63,660. Silver futures need to pullback and sustain above the 20-WMA as soon as possible. Else, the trend could remain bearish in the medium-term with a possibility of prices declining to Rs 57,500-odd level. 

Having said that, the next major support on the weekly chart stands at Rs 62,000 - i.e. the 50-WMA.

The key momentum oscillators, both, on the daily and weekly chart are in favour of the bears. Hence, Silver futures are likely to witness further downward pressure in the near term. The only cushion of hope for the bulls is that the 14-day RSI is in oversold zone, below 30-odd level.

According to the weekly Fibonacci chart, the MCX Silver March futures, this week, may swing in a broad range of Rs 61,580 to Rs 65,290, with support likely around Rs 62,775 - Rs 62,290 - Rs 61,935. On the upside, the precious metal may face resistance around Rs 64,100 - Rs 64,580 - Rs 64,930.

On Monday, Silver March futures may test support around Rs 63,160 - Rs 62,955 - Rs 62,660, while on the upside the contract may meet resistance around Rs 63,700 - Rs 63,910 - Rs 64,200.

Similarly, MCX Silver Mini February futures could seek support around Rs 63,220 - Rs 63,000 - Rs 62,700; whereas on the upside the Mini contract may face resistance around Rs 63,780 - Rs 64,000 - Rs 64,300 today.

Further, the MCX Silver Micro February futures are likely to seek support around Rs 63,150 - Rs 62,950 - Rs 62,645; whereas the contract could counter resistance around Rs 63,725 - Rs 63,930 - Rs 64,235 on Monday.