Gold managed to gain last week, but silver ended up posting a loss. The former was up 0.4 per cent and the latter down 2 per cent to end at $2,164.2 and $24.7 per ounce, respectively.
On the Multi Commodity Exchange, gold futures gained 0.5 per cent to end at ₹65,858 (per 10 gram), whereas silver futures lost 1.1 per cent to close at ₹74,787 (per kg).
MCX-Gold (₹65,858)
Gold futures (April contract) rallied and hit a record high of ₹66,943 before moderating to end the week at ₹65,858 on Friday.
The chart indicates that the contract could see a corrective decline from here, possibly to ₹64,000. Note that ₹65,200 is a support.
For gold futures to see a fresh leg of rally, it ought to decisively break out of ₹66,500. Nevertheless, there is a potential for the contract to hit ₹70,000 within next few months as the broader trend is up.
Trade strategy: We suggested buying gold futures at ₹66,000. Hold this position. But revise the stop-loss up to ₹65,000 from the current ₹63,900.
If the contract goes past ₹67,000, raise the stop-loss to ₹65,800. Liquidate the longs at ₹68,000.
MCX-Silver (₹74,787)
Silver futures (May series) registered an intraweek high of ₹78,323 on Thursday before ending the week at ₹74,787.
While it managed to close above the 200-day moving average, it could see a dip in price to ₹73,800, which could extend to ₹72,500.
But if silver futures see a daily close above ₹76,000, it can establish a rally to ₹79,000. Note that the price band of ₹79,000-80,000 is a potential barrier.
Trade strategy: Stay away for now. Buy silver futures if it breaks out of ₹76,000. Place initial stop-loss at ₹74,400. When the contract touches ₹78,000, tighten the stop-loss to ₹76,500. Book profits ₹79,000.