New Delhi, November 3 (IANS). Before Dhanteras and Diwali, the price of gold and silver continues to fluctuate. The slight recovery on Monday did not last long and on Tuesday, precious metals were again under pressure in both the domestic and international markets. Gold and silver prices on MCX fell by more than 1 percent. There was pressure on gold and silver prices due to the tough stance of the US Federal Reserve, the possibility of interest rates remaining high for a long time and the strong rupee.
In the international market Comex, both gold and silver were seen trading with a decline on Tuesday. Gold fell by about 1.05 percent to reach $ 3,928 an ounce, while silver was seen trading at $ 59.25 an ounce with a decline of 3.22 percent.
According to analysts, investors are cautious ahead of the US mid-term elections and risk appetite remains limited in the market at present. This is the reason why even after Monday's recovery, heavy buying was not seen.
The impact of international weakness was clearly visible on the Indian market as well. In the domestic market, gold fell by about 1 percent to Rs. 1.39 lakh per 10 grams, while the price of silver slipped by nearly 3 percent to Rs. 1.78 lakh per kg.
On the Multi Commodity Exchange (MCX), gold for December delivery opened at Rs 1,39,420 per 10 grams, down Rs 766 or 0.54 per cent from its previous closing price of Rs 1,40,186, while at one point in the day's trade it fell Rs 1,508 or 1.07 per cent to the day's low of Rs 1,38,678 per 10 grams.
At the same time, silver for December delivery opened at Rs 1,82,887 per kg, slipping by Rs 892 or 0.48 per cent from its previous close of Rs 1,83,779, while at one point in the day's trade it fell by Rs 5,667 or 3.08 per cent to reach the day's low of Rs 1,78,112 per kg.
Market experts said softening US bond yields and weakness in the dollar generally support gold, but the Federal Reserve's tough stance and fears of higher interest rates have kept the precious metal under pressure. At the same time, ongoing tensions in West Asia and high crude oil prices are increasing inflation related concerns.
Experts believe that at present the direction of gold and silver will depend on the policy of the US Federal Reserve and inflation data. The market now considers the Fed's chances of raising interest rates in December to be slightly lower than before, but uncertainty still remains.
According to technical analysis, the level of Rs 1.40 lakh to Rs 1.41 lakh is considered the important resistance for MCX Gold, and below this the zone of Rs 1.37 lakh to Rs 1.38 lakh is considered the important support. For silver, there is a support zone of Rs 1.78 lakh to Rs 1.80 lakh, while on the upside, Rs 1.86 lakh to Rs 1.88 lakh remains a strong resistance.
Meanwhile, the recent fall in crude oil prices has definitely provided some relief. Heavy selling has been seen in Brent and WTI crude in the international market, as expectations of easing of tension have increased after developments related to Iran. However, geopolitical risks have not completely gone away yet, so investors remain cautious.
–IANS
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