The precious metals appreciated for a third week in a row, showing strong momentum. Gold and silver appreciated 3.4 per cent and 4.5 per cent as they closed the week at $2,070.9 and $25.4 per ounce respectively.
Likewise, on the MCX, gold futures was up 2.8 per cent and silver futures gained 3.4 per cent by closing the week at ₹63,357 (per 10 gram) and ₹78,087 (per kg) respectively.
MCX-Gold (₹63,357)
Gold futures (February contract) rallied past the resistance at ₹61,800 and ₹63,300 last week. The price action shows strong upward momentum, and the probability of further rally is high.
The nearest barrier can be identified at ₹65,000. If the upswing extends beyond this level, gold futures could touch ₹66,000 in the near term.
If there is a correction from the current level, it is not likely to go beyond ₹62,500, a potential support. Below this level, ₹61,800 is now a resistance-turned-support.
Trade strategy: Since gold futures has broken out of the resistance at ₹63,300, traders can initiate fresh long positions. That is, buy now at ₹63,357 and accumulate if the price dips to ₹62,500. Place initial stop-loss at ₹61,700.
When the contract rallies past ₹64,000, tighten the stop-loss to ₹62,800. Tighten the stop-loss further to ₹63,800 when the price touches ₹64,500. Exit at ₹65,000.
MCX-Silver (₹78,087)
Silver futures (March series) rallied to mark an intraweek high of ₹78,240 on Friday before closing a little lower at ₹78,087.
In case silver futures continues its uptrend, it is likely to face minor resistance at ₹79,400. But eventually, the contract might rise to ₹81,000, a potential resistance. Above this, ₹83,000 can be a barrier.
But if silver futures falls from the current level, the nearest supports are at ₹76,800 and ₹75,000.
Trade strategy: Buy silver futures now at ₹78,087 and on a dip to ₹76,400. Stop-loss at ₹75,000. When the contract rallies above ₹79,400, tighten the stop-loss to ₹77,000. Book profits at ₹81,000.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.