Gold and silver prices today: Yellow metal likely to be volatile as bulls aim for $2000 threshold

Gold opened on the Multi Commodity Exchange (MCX) on Monday at Rs 60,477 per 10 grams and hit an intraday low of Rs 60,400. In the international market, prices hovered around $1,972.46 per troy ounce. Meanwhile, silver opened at Rs 72,645 per kg, hit an intraday low of Rs 72,511 on the MCX, and hovered around $23.24 per troy ounce in the international market. 

Praveen Singh, Associate VP, Fundamental Currencies and Commodities, Sharekhan by BNP Paribas, said, "Gold extended its parabolic rally Friday on the key central banks hinting at a pause in their rate hike spree and safe haven demand due to the ongoing middle East conflict. The yellow metal was up 0.40% Friday to close at $1982 in a volatile session."  

The situation in the Middle East remains alarming. It has been reported that Israeli soldiers clashed with Hamas in Gaza for the first time in this conflict. Singh said, "The yellow metal is likely to be volatile as bulls aim for $2000." 

Manav Modi, Analyst, Commodity and Currency, MOFSL, said, "The safe haven asset, gold, hit its highest since mid-May last week and recorded their second consecutive weekly rise, as investors opted for the safety of bullion against the Middle East conflict." 

However, the prices fell, retreating from a five-month peak scaled in the previous session, as robust U.S. Treasury yields cut demand for the non-yielding asset ahead of key inflation and economic growth data due later this week.  

"On the other hand, relentless selling of U.S. government bonds has brought Treasury yields to their highest level in more than a decade and a half, curbing demand for gold," said Modi. 

US Federal Reserve Governor Jerome Powell, in his comments, mentioned that as per the impact of previous hikes on economy, US central bank will tighten the monetary policy further. Atlanta Fed President Raphael Bostic mentioned that while inflation remains too high it is coming down amid mounting evidence of an economic slowing, and that could open the door to easier monetary policy late next year.  

"Focus now shifts to US GDP, Core PCE price index, Core durables goods orders data and comments from governor Powell," said Modi. 

The Federal Reserve Chair Powell's speech at the Economic Club of New York has been construed as dovish; thus, the odds of a rate hike in the next two FOMC meets have dropped to 20%.  

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Anuj Gupta, Head of Commodity and Currency at HDFC Securities, said, "Although the dollar index is trading at 106.25 levels, which is again working as a hurdle for a speed of gold. Overall, the technical trend of gold is to go up. War situation is still on, which may further support gold prices. For trading, gold may trade between $1960 to $1980 levels and on MCX it may trade between 60000 to 61000 levels." 

Additionally, Amit Khare, Associate Vice President at GCL Broking, said, "December Gold closed at 60725(1.09%) and December Silver closed at 72915(1.89%). As per the daily chart, Bullions are looking positive. We can see some further upside movement in coming future. Momentum Indicator RSI also indicates the same, So traders are advised to make fresh buy positions in Gold and Silver near the given support level one with the stop loss of support level two and book near given resistance levels: Gold December Support 60500/60200 and Resistance 61000/61300. Silver December Support 72200/71400 and Resistance 73000/73600.”