Gold price today: Gold rate dropped by over half a per cent while that of silver crashed more than 2% in early deals on the MCX on Thursday, 23 April, due to profit booking after the US dollar climbed amid a rebound in crude oil prices, following reports of fresh tensions between the US and Iran.
MCX gold June contracts were down about 0.50% at ₹1,51,947 per 10 grams, while MCX silver May contracts were down by nearly 2% at ₹2,43,856 per kg around 9:10 am.
The dollar index climbed by 0.15%, weighing on gold prices, after Brent Crude prices jumped by 2% to trade above the $103 a barrel.
A spike in crude oil prices drives the demand for dollars higher as the commodity’s global trade mostly takes place in greenbacks.
The fate of the US-Iran conflict remains shrouded in uncertainty. Even though US President Donald Trump has extended the ceasefire with Iran for an indefinite period, there are no clear signs of progress towards the end of the war, with fresh reports suggesting the US military has intercepted at least three Iranian-flagged tankers in Asian waters, and Iran seized two ships in the Strait of Hormuz on Wednesday.
The potential second round of peace talks between the two countries did not take place as neither side showed up for talks in Pakistan.
Besides, some reports indicated that the US is not willing to extend the ceasefire for an “indefinite” period. Trump may allow Iran between three and five days to resolve its internal power struggle and present a coherent counteroffer — but the ceasefire he extended on Tuesday will not last indefinitely, three US officials told Axios.
The West Asian conflict and the resulting jump in crude oil prices have raised inflationary risks and dimmed the prospects of rate cuts by the US Fed over the next few months.
According to a Reuters poll of economists, the US Fed may delay interest rate cuts for at least the next six months.
The US-Iran conflict has exerted pressure on gold prices, as it drove the dollar up and weakened expectations of interest rate cuts.
Domestic spot gold prices, as per MCX, have fallen more than 4% since the beginning of the US-Iran war on 28 February this year.
However, the yellow metal remains among the best-performing asset classes this year. Year-to-date, spot gold prices in India have gained 14% after surging 75% last year, as per MCX data. In comparison, equity benchmark Nifty 50 has declined 7% so far this year.
“We expect gold and silver prices to remain volatile this week amid volatility in the dollar index, crude oil prices and US-Iran peace deal uncertainty,” said Manoj Kumar Jain of Prithvifinmart Commodity Research.
According to Manoj Kumar Jain of Prithvifinmart Commodity Research, gold has support at $4,720 and $4,681, while resistance is at $4,785 and $4,818 per troy ounce, and silver has support at $76 and $74, while resistance is at $79.80 and $81.40 per troy ounce in today’s session.
On the MCX, gold has support at ₹1,51,500 and ₹1,50,650 and resistance at ₹1,53,650 and ₹1,54,700, while silver has support at ₹2,45,500 and ₹2,42,000 and resistance at ₹2,51,200 and ₹2,54,800, said Jain, suggesting booking profits in gold and silver long positions and waiting for some corrective dips for initiating fresh long positions.
According to Ponmudi R, CEO of Enrich Money, for MCX gold, a sustained move above ₹1,55,000 could revive momentum toward ₹1,57,000- ₹1,58,000. On the downside, a break below ₹1,52,000 may lead to a corrective move toward ₹1,51,000- ₹1,50,000 and further to ₹1,48,000.
“The bias remains cautious, with macro factors offering limited support; however, failure to break above resistance levels may keep momentum weak and tilt the trend further to the downside,” said Ponmudi.
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Disclaimer: This story is for educational purposes only. 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.
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