Gold and silver prices have remained volatile since the last few trading sessions driven US-Iran uncertainties and changing expectaions over interest rates.
Spot gold dropped 0.17% to $4,399 on Tuesday, while Silver fell around 0.19% to $66/oz.
Bullion prices in India dipped too, with MCX gold October futures contract declined 0.04% to Rs 1,52,894 per 10 grams, while MCX silver December futures contract fell 0.05% to Rs 2,38,900 per kg.
Meanwhile, brent crude neared $100/barrel following US-Iran tensions around the Strait of Hormuz, continuing inflation concerns and raising expectations of a potential Fed hike to around 60%.
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What To Expect From Precious Metals?
According to Kotak, the rally in oil prices and treasury yields remain the key near-term headwinds for non-yielding gold, while upcoming US PPI and CPI data could determine whether rate-hike expectations intensify or retreat. A weaker US dollar, especially against a strong yen, provided some support. Despite these pressures, gold continues to hold around $4,400 after rebounding from July's $4,000 floor.
Continued central-bank demand, portfolio diversification and fiscal-debasement concerns remain powerful medium-term drivers. Near-term volatility may continue if inflation and yields advance, but sustained dollar weakness, central-bank buying and geopolitical risk should keep the broader upside bias intact.
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Technical Levels To Watch
Kotak expects Spot Gold to face support at $4,365.5. If this level is breached, then the metal will find next key support at $ 4342.7. A furtherdownside will move the next support $ 4268.9 level, the analysts highlighted. Resistance is seen at $ 4439.3, followed by $ 4462.1 and $ 4,535.9.
In case of MCX Gold October futures, support levels are placed at Rs 1,51,767, Rs 1,51,040 and Rs 1,48,687. Analysts expect resistance level at Rs 1,54,119, Rs 1,54,846 and Rs 1,57,199.
In terms of silver, Kotak estimates support for Spot Silver at $65.24, followed by $64.72 and further downside of $63.03. Resistance is seen at $66.93, $67.46 and $69.15.
On MCX, Silver is likely to face support at Rs 2,36,195, Rs 2,34,817 and Rs 2,30,356. Resistance is placed at Rs 2,40,657, Rs 2,42,035 and Rs 2,46,496.
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