Upside for Gold seen capped at Rs 56,950; Silver may test Rs 64,000

On the downside, the Rs 56,235-level is the key support for Gold futures, below which a prolonged consolidation phase seems likely.

The MCX Gold futures slipped below its short-term moving average for the first time in three months. Going ahead, the Rs 56,950-level needs to be closely watched to gauge the market sentiment. Sustained trade below the same could lead to a consolidation and price correction.

Meanwhile, the short-term bias for Silver futures has turned negative hence the commodity could see some downward pressure in the near term. To reverse the negative bias, Silver futures will need to trade above the Rs 68,400-level on a consistent basis.

Gold

Bias: Consolidation likely

Last Close: Rs 56,741

Support: Rs 56,235

Resistance: Rs 56,950

Last week, the MCX Gold futures dipped below the 20-DMA (Daily Moving Average) for the first time since November 11, 2022. Post the breakout then, Gold prices had soared over 17.5 per cent in matter of just three months.

Presently, after registering a new peak at Rs 58,826, the precious metal has declined 4 per cent in the last six trading sessions. 

The 20-DMA currently stands at Rs 56,950. Gold futures need to cross and sustain above the same as soon as possible for the bullish bias to remain intact. However, in case, Gold futures are unable to conquer the 20-DMA, a prolonged consolidation period can be expected.

The next key support levels for Gold futures are the 50-DMA placed at Rs 55,640 and the lower-end of the Bollinger Bands on the daily chart at Rs 55,975.

In case, support at the 50-DMA too gets violated a deeper price correction would likely be on the cards, with downside targets up to Rs 53,800-level.

However, since Gold had given a 'BUY' signal on the monthly and quarterly Fibonacci chart, the Rs 56,390 - Rs 56,130 - Rs 55,865 are the strong supports as per the monthly Fibonacci chart; whereas Rs 56,235 is a major support as per the quarterly Fibonacci chart.

Accordingly to the weekly Fibonacci chart, this week, the MCX Gold April futures are likely to face resistance around Rs 56,950 - Rs 57,100 - Rs 57,300, and on the downside the commodity could seek support around Rs 56,390 - Rs 56,280 - Rs 56,170.

On Monday, the MCX Gold April futures contract is likely to counter resistance around Rs 56,820 - Rs 56,880 - Rs 56,970, while on the downside the contract may slip to Rs 56,600 - Rs 56,555 - Rs 56,510.

Similarly, the MCX Gold Mini March futures are expected to meet resistance around Rs 56,785 - Rs 56,840 - Rs 56,920, and on the downside the contract could seek support around Rs 56,585 - Rs 56,540 - Rs 56,500 today.

Silver

Bias: Negative

Last Close: Rs 66,664

Target: Rs 64,000; Rs 61,000

Support: Rs 66,230

Resistance: Rs 68,400

The short-term trend for Silver futures has turned negative on the daily chart, with the slipover of the 20-DMA below the 50-DMA. The 20-DMA for Silver March futures now stands at Rs 68,286, while the 50-DMA has moved to Rs 68,386.

Presently, Silver futures are seen seeking support around the lower-end of the Bollinger Bands on the daily chart at Rs 66,230-odd level. In case, this support is violated, Silver prices can extend decline towards the 100-DMA, indicating a downside target of Rs 64,000. The next major support visible on chart is at Rs 61,000 - its 200-DMA.

Select key momentum oscillators continue to remain in favour of the bears on the daily chart, with the MACD now also turning negative on the weekly chart. Hence, we may see more downward pressure in the near term. 

According to the weekly Fibonacci chart, the MCX Silver March futures, this week, may swing in a broad range of Rs 65,475 to Rs 67,855, with support likely around Rs 66,240 - Rs 65,925 - Rs 65,700. On the upside, the contract may face resistance around Rs 67,085 - Rs 67,400 - Rs 67,630.

On Monday, Silver March futures are likely to seek support around Rs 66,470 - Rs 66,330 - Rs 66,120, while on the upside the commodity may counter resistance around Rs 67,000 - Rs 67,100 - Rs 67,210.

Similarly, MCX Silver Mini February futures could seek support around Rs 66,685 - Rs 66,550 - Rs 66,360; whereas on the upside the Mini contract may face resistance around Rs 67,175 - Rs 67,270 - Rs 67,370 today.

Further, the MCX Silver Micro February futures are likely to seek support around Rs 66,700 - Rs 66,575 - Rs 66,385; whereas the contract could face resistance around Rs 67,190 - Rs 67,285 - Rs 67,380 on Monday.