Gold and silver prices continued to fall on Monday following an increase in margin requirements on the Chicago Mercantile Exchange (CME) in the US. MCX gold futures for February dropped by 1.77% to Rs 1,45,132 per 10 grams, while MCX silver futures for March fell by 6.88% to Rs 2,47,386 per kg.
Analysts attributed the decline in precious metal prices to the selection of Kevin Warsh as the next US Fed Chairman by President Donald Trump. Warsh’s perceived aggressive stance on interest rates caused negative investor reactions. The strengthening US dollar, higher Treasury yields, and positive US inflation data further contributed to the downward trend.
Market experts predict that silver could find support near $68, while gold may stabilize around $4,510 this week. Despite an initial drop of 4% in Asian trading hours on Monday, spot gold showed signs of recovery later in the day.
Commenting on the market outlook, analysts noted key support levels for gold at Rs 1,39,650 to Rs 1,36,310 and resistance levels at Rs 1,48,850 and Rs 1,50,950. For silver, support levels were identified at Rs 2,48,810 and Rs 2,37,170, with resistance at Rs 2,78,810 and Rs 2,95,470.
The broader market trend for COMEX gold remains positive, despite recent profit booking following a rapid rally. Silver prices continue to benefit from supply deficits and steady industrial demand. Factors such as safe-haven demand, central bank accumulation, and expectations of accommodative global monetary policies support the prices of gold.
A report from WhiteOak Capital Mutual Fund suggested investors reduce their exposure to precious metals, particularly silver, due to its overextended valuation relative to historical levels.
