Gold ($2,639/ounce) and silver ($29.6/ounce) saw an uptick in price and posted gains of 0.7 and 0.8 per cent respectively last week.

In the domestic market, gold futures (₹77,317/10 gm) was up 1 per cent and silver futures (₹89,221/kg) gained 0.4 per cent.

MCX-Gold (₹77,317)

Gold futures (February) appreciated and closed above both 20 and 50-day moving averages (DMAs). The price has been moving up gradually over the past two weeks.

Nevertheless, gold futures has a resistance ahead. Also, there are support levels on the downside that can arrest the fall.

The chart shows that the contract has been forming a triangle pattern; traders need to wait for more indications before initiating a trade. That said, the price action shows that there is a small upside bias.

Key resistance levels are ₹78,500 and ₹80,000 whereas notable support can be seen at ₹76,400 and ₹75,000.

Trade strategy: Traders with high risk appetite can buy gold futures if it dips to ₹76,800. Target and stop-loss can be ₹80,000 and ₹75,000 respectively.

MCX-Silver (₹89,221)

Silver futures (March) is relatively weaker when compared to gold futures as the price is below 20 and 50-DMAs.

However, the chart shows that silver futures has been trading between ₹86,800 and ₹90,200. The next leg of trend depends on the direction of the break of this price band.

If the contract starts rallying and surpasses ₹90,200, it can extend the upside to ₹94,000 or to ₹96,500. A breakout of ₹96,500 can turn the trend bullish. Resistance above ₹96,500 is at ₹1,02,500.

On the other hand, a breach of ₹86,800 can drag the contract to ₹83,500.

Trade strategy: Because of the uncertainty with respect to the trend, we suggest staying out for now.

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