Gold produced a marginal gain last week, whereas silver was down a bit. But broadly, there is a lack of momentum in both precious metals. In the international market, spot gold closed the week at $1,927.3 an ounce against the preceding week’s close of $1,926.6. Spot silver ended at $23.56 per ounce last week compared with $23.95 a week earlier.

On the Multi Commodity Exchange (MCX), gold futures (April contract) gained 0.6 per cent to close the week at ₹57,279 (per 10 gram), whereas silver futures (March expiry) lost one-third of a per cent to wrap up the week at ₹68,329 (per kg).

MCX-Gold (₹57,279)

Although gold April futures on the MCX posted a gain, the price action on the daily chart has started showing a lack of momentum. So, there might be a minor correction before resuming the next leg of the rally. On the downside, there are support at ₹56,200 and ₹55,500. That said, if the contract rallies past ₹57,600, the upside can extend to ₹59,000 and possibly to ₹60,000 in the coming weeks.

Trade strategy: Based on our suggestion, traders would be holding long positions in February futures initiated at ₹55,000. Stop-loss and target for this are at ₹55,800 and ₹58,000 respectively. Exit this at the current level of about ₹56,860. Since this contract is nearing expiry, fresh positions can be taken in the April contract.

Buy gold April futures if it rallies past ₹57,600. Stop-loss and target can be at ₹55,500 and ₹59,800 respectively.

MCX-Silver (₹68,329)

The March silver futures ended the week 0.3 per cent lower at ₹68,329 compared with the preceding week’s close of ₹68,547. Thus, the price band of ₹67,000-70,000 holds true. The swing in price can be predicted only if the contract gets out of this range.

In case the contract breaks out of ₹70,000, the bulls will make a comeback taking the price to ₹73,000 swiftly. On the other hand, if silver futures breach the lower boundary of the range at ₹67,000, we could see a quick drop in price to the nearest support at ₹64,000.

Trade strategy: Stay on the fence for now. Initiate fresh longs above ₹70,000. Target and stop-loss for this can be at ₹73,000 and at ₹68,300 respectively.