Gold and Silver can rally up to 10% on MCX, show charts

The MCX Gold futures have gained 4 per cent and Silver 6.5 per cent so far in March on hopes of interest rate cuts in the US. Chart suggests that positive bias shall prevail in the near-term.

Gold prices have scaled record high levels of $2,165 per ounce in international markets in recent days on hopes of likely interest rate cuts later this year.

The US Federal Reserve chief, Jerome Powell, in his testimony on Wednesday March 06 reiterated that it could lower rates later this year, without specifying any particular time-line. 

The US Fed Watch Tool predictor suggests over 55 per cent probability of a rate cut in June, as the US economy seems to be on a stronger ground than expected.

Back in India, the MCX Gold April futures were seen quoting atop the Rs 65,000-mark, having gained over 4 per cent so far in March 2024. For the year, Gold prices were up 3.2 per cent so far in 2024. In 2023, Gold prices had soared nearly 15 per cent. 

Meanwhile, the MCX Silver futures have rallied 6.5 per cent so far this March, and have gained a solid 17.3 per cent so far this calendar year. 

Given this background, here's a quick chart check on these two precious metals for the likely future trend.

MCX Gold April futures

Last Close: Rs 65,200

Upside Potential: 4%

Support: Rs 64,600; Rs 64,000 - Rs 63,400

Resistance: Rs 65,780

The daily chart suggests that Gold futures are likely to trade with a positive bias as long as prices sustain above Rs 65,100 levels.

Further, the Gold prices are presently quoting above the higher-end of the Bollinger Bands on the weekly scale as well. A weekly close above Rs 64,600 levels can provide added ammunition to the bulls. 

Key momentum oscillators, both on the daily and weekly chart are also placed favourably. Thus, suggesting that the prevailing up trend may sustain in the near-term. 

As per the Fibonacci chart, Gold prices could face some resistance around Rs 65,780 levels. Break and close above the same can trigger a rally towards Rs 67,600 levels.

On the flip side, failure to conquer the Rs 65,750 hurdle could trigger a phase of consolidation; wherein, Gold futures are expected to find considerable support in the range of Rs 64,000 - Rs 63,400.

MCX Silver May futures

Last Close: Rs 74,200

Upside Potential: 10.5%

Support: Rs 73,750; Rs 72,600

Resistance: Rs 76,800

Similar to Gold, the MCX Silver May futures too are seen trading above the higher-end of the Bollinger Bands on the daily scale. Thus suggesting that the near-term bias is likely to remain positive as long as Silver quotes above Rs 73,750 levels.

That apart, the weekly chart shows a likely breakout on the price-to-moving averages basis. Silver futures presently quote firmly above its 20-WMA (Weekly Moving Average) which stands at Rs 72,600. A weekly close above the same should strengthen the current trend.

On the upside the Silver futures could face some resistance around Rs 76,800 levels. Above which, the monthly chart indicates, that Silver futures can potentially rally to Rs 82,000 levels - thus indicating an upside of 10.5 per cent.