Gold and Silver Prices Face Pressure Ahead of Dhanteras and Diwali

New Delhi, November 3 (Daily Kiran) : The fluctuations in gold and silver prices continue as Dhanteras and Diwali approach. On Tuesday, both domestic and international markets saw renewed pressure on precious metals, following a brief recovery on Monday that did not last. Prices for gold and silver on the Multi Commodity Exchange (MCX) fell by over 1 percent.

In the international market, both gold and silver experienced declines. Gold dropped approximately 1.05 percent, trading at $3,928 per ounce, while silver fell by 3.22 percent, reaching $59.25 per ounce.

Analysts note that investors are exercising caution ahead of the upcoming U.S. midterm elections, leading to limited risk appetite in the market. This hesitance has resulted in a lack of significant buying despite Monday’s recovery.

The impact of international trends is evident in the Indian market as well. Gold prices fell nearly 1 percent, dropping below ₹1.39 lakh per 10 grams, while silver prices decreased by about 3 percent, nearing ₹1.78 lakh per kilogram.

On the MCX, gold for December delivery opened at ₹1,39,420 per 10 grams, down ₹766 or 0.54 percent from the previous close of ₹1,40,186. During the day, prices hit a low of ₹1,38,678, reflecting a decline of ₹1,508 or 1.07 percent.

Silver for December delivery opened at ₹1,82,887 per kilogram, down ₹892 or 0.48 percent from its previous close of ₹1,83,779. At one point, silver fell to a low of ₹1,78,112, a drop of ₹5,667 or 3.08 percent.

Market experts have indicated that a softening of U.S. bond yields and a weaker dollar typically support gold prices. However, the Federal Reserve’s hawkish stance and the expectation of prolonged high interest rates continue to exert pressure on precious metals. Additionally, ongoing tensions in the Middle East and rising crude oil prices are fueling inflation concerns.

Experts believe that the future direction of gold and silver will depend on the Federal Reserve’s policies and inflation data. The market currently perceives a slightly lower probability of an interest rate hike in December compared to earlier expectations, although uncertainty remains.

Technical analysis suggests that for MCX gold, the key resistance level is between ₹1.40 lakh and ₹1.41 lakh, while support is seen in the range of ₹1.37 lakh to ₹1.38 lakh. For silver, the support zone lies between ₹1.78 lakh and ₹1.80 lakh, with strong resistance above at ₹1.86 lakh to ₹1.88 lakh.

Meanwhile, a recent decline in crude oil prices has offered some relief. The international market has witnessed heavy selling in Brent and WTI crude, as hopes rise for reduced tensions following developments related to Iran. However, geopolitical risks have not fully dissipated, keeping investors on alert.