Stronger US Dollar, Fed Rate Pause, and Budget Watching Push MCX Gold and Silver into Sharp Sell-Off

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Gold prices fell sharply on the Multi-Commodity Exchange on Friday morning. The fall came after traders booked profits at higher levels. Gold had risen strongly in recent weeks. The sudden selling pushed prices down in early trade.

MCX gold February futures dropped by more than Rs. 10,000. The fall was close to 6%. Prices slipped to around Rs. 1,59,250 per 10 grams. The move shocked many market participants after the recent rally.

Silver Joins the Sell-Off

Silver prices also saw heavy selling. MCX silver March futures fell by nearly Rs. 24,000. This marked a fall of about 6%. Silver traded near Rs. 3,75,900 per kilogram during the session. The metal followed gold lower as traders exited positions.

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The main reason behind the fall was profit booking. Gold and silver had gained sharply over the past months. Gold prices rose more than 24% in January. Silver prices jumped over 60% in the same period. Such fast gains often lead to selling at higher levels.

Global Cues Add Pressure

Global factors added pressure on prices. Gold prices eased in overseas markets as the US dollar became stronger. A strong dollar makes gold expensive for buyers using other currencies. This reduces demand and pulls prices lower.

The dollar index moved higher after political clarity in the US. A deal to avoid a partial government shutdown supported the dollar. The US Federal Reserve also kept interest rates unchanged. This further helped the dollar and weighed on gold prices.

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Experts say gold and silver may stay volatile in the short term. Markets are reacting to global news and local events. The upcoming Indian Union Budget may influence sentiment. Geopolitical tensions also remain in focus.

Key Levels and Market Outlook

Analysts shared key levels to watch for MCX gold price. Support is seen near Rs. 1,65,500 and Rs. 1,61,100 per 10 grams. Resistance stands near Rs. 1,74,400 and Rs. 1,80,000. These levels may guide near-term movement.

Silver also has important price zones. Support lies near Rs. 3,88,000 and Rs. 3,74,000 per kilogram. Resistance is seen around Rs. 4,10,000 and Rs. 4,22,000. Silver may remain more volatile due to its sharp rise earlier.

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Some experts suggest buying gold on dips if prices hold above support. They advise caution due to fast price changes. Sudden moves remain possible in the current market.

Despite the fall, the broader outlook for gold stays supported. Rate cut hopes, global risks, and steady demand continue to support prices. Short-term corrections often follow strong rallies. The market now watches to see if prices stabilize in the coming sessions.