Fireworks for MCX Gold, Silver futures on Diwali day, analyst recommends buy for these targets

Gold and Silver were trading with a positive bias on Thursday when the markets reopened in the evening trade. The markets were closed in the morning session on account of Diwali. The December gold futures were dearer by Rs 552 per 10 gram while the December Silver futures were up by Rs 1552 per kg.

At 6:40 pm, the yellow metal was trading at Rs 47,552 and were up by 1.2 per cent from the Wednesday closing price. Meanwhile, Silver futures were trading at Rs 64,017 per kg, up by 2.5 per cent.  

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Expert Anuj Gupta, Vice President (VP), Commodity and Currency Research at IIFL Securities recommends a Buy on December Gold futures at Rs 47,300 with a stop loss at Rs 46,900 and target at Rs 48,000.

Buy Silver futures at Rs 63,500 with a stop loss at Rs 63,000 and price target at Rs 64800.

The domestic bullion prices took cues from the global markets. Gold prices jumped 1 per cent on Thursday after the Federal Reserve indicated it would be patient on raising interest rates and as the Bank of England defied expectations of more hawkish policy, Reuters reported.

Spot gold was up 1 per cent to USD 1,787.26 per ounce at 1241 GMT (6:11 pm), after touching a three-week low on Wednesday. US gold futures for December delivery jumped 1.3 per cent to USD 1,787 per ounce, the report further said.

Independent analyst Ross Norman said strong physical demand for gold was supporting market, as India`s Diwali festival generally boosts sales of the precious metal, this report said.

The U.S. central bank said on Wednesday it would start trimming its massive bond-buying programme beginning this month, and stuck with its contention that high inflation would be transitory.
 

Following that, the Bank of England kept interest rates on hold on Thursday, dashing expectations for a hike that would have made it the first of the world`s big central banks to raise rates after the pandemic.

Reduced stimulus and interest rate hikes tend to push government bond yields up, raising the opportunity cost of gold, which pays no interest.

Elsewhere, spot silver rose 1.2 per cent to USD 23.79 per ounce. Platinum gained 0.8 per cent to USD 1,037.35 per ounce and palladium jumped 2.2 per cent to USD 2,043.54 per ounce.