Precious metal prices: Gold prices in Wednesday's session (January 8) were up by a tad amid a stronger dollar and yields after the latest US jobs data hinted that the Federal Reserve may slow the pace of its rate cut cycle.

COMMERCIAL BREAK
SCROLL TO CONTINUE READING

At 12:33 pm, Gold February futures on the MCX traded with gains of just 0.1 per cent or Rs 74 at Rs 77,605 per 10 gm, while silver March futures were up 0.14 per cent or Rs 131 at Rs 91,004 per kg.

On Tuesday, gold and silver were settled on a positive note in the international markets. Gold February futures contract settled at $2,665.40 per troy ounce, up by 0.68 per cent and silver March futures contract were settled at $30.686 per troy ounce, up by 0.34 per cent. The trend was followed in the domestic markets too, with Gold February futures contract settling at Rs 77,531 per 10 grams with a gain of 0.48 per cent and silver March futures contract settled at Rs 90,873 per kilogram with a gain of 0.35 per cent.

Strong central bank buying supports gold markets

Dr. Renisha Chainani, Head of Research at Augmont said, "In November 2024, the central bank increased its gold reserves by 53 tons, indicating continued strong purchases. The Reserve Bank of India resumed its 2024 purchasing spree, increasing 8 tons of its gold reserves in November. This brings YTD buying to 73 tonnes and total gold holdings to 876 tonnes, retaining its position as the second-highest buyer in 2024 after Poland."

The People's Bank of China has also increased gold holdings by 5 tonnes, indicating rising demand as global economic worries linger, she added.

Gains remained capped due to rebound in dollar index and the US bond yields

The dollar rose and the benchmark 10-year treasury yields also climbed to an eight-month high after better-than-anticipated data on Tuesday. US job opening in November surged to 8.098 million, higher than anticipated 7.7 million opening, and still better than October numbers of 7.839 million.

Also, on the sidelines, gains in the bullion were checked after the U.S. services PMI reading reached 54.1.

Gold and silver price support and resistance levels

Gold has support at $2650-2634, while resistance at $2680-2694 per troy ounce and silver has support at $30.45-30.20, while resistance is at $30.88-31.20 per troy ounce in today’s session. At mcx, gold is having support at 77220-77000 and resistance at 77800-78000 while silver is having support at 90150-89500 and resistance at 91650-92400. 

Trading strategy

We suggest wait for some corrective dips for initiating fresh long positions in gold and silver, said Manoj Jain- Commodity Expert- India Nivesh.