Gold prices in India have been increasing for the last few days, due to which the market is witnessing a bullish trend. According to India Bullion and Jewelers Association, the price of gold increased from Rs 74,390 to Rs 75,680 per 10 grams. Earlier, on November 14, the price of gold was Rs 74,370 per 10 grams, which was indicating a considerable rise.

Silver prices have also increased, with both gold and silver rising on the Multi Commodity Exchange (MCX) as of Tuesday, November 19, 2024.

On MCX, the futures price of gold maturing on December 5, 2024 was at Rs 75,450 per 10 grams, showing a rise of Rs 403 or 0.54%. The previous closing price was Rs 75,047.

The reason for the increase in gold prices is considered to be the weakening of the US dollar. And investor interest in safe-haven assets increased amid geopolitical and economic concerns. Silver prices have also followed a similar trend, benefiting from the overall movement in the metal market.

Factors affecting gold prices

geopolitical tensions – Jatin Trivedi, VP Research Analyst at LKP Securities, said rising tensions between Russia and Ukraine have contributed to the rise in gold. US President Joe Biden’s approval of Ukraine to use long-range missiles inside Russia and Moscow’s deployment of 50,000 troops have heightened global uncertainties, sending investors turning to gold as a safe-haven asset.

“This geopolitical risk boosted gold prices as investors turned to safe-haven assets. Key support for gold is seen around Rs 74,200-74,250, while resistance lies at Rs 75,100,” he said.

Interest rate speculation – The upcoming decisions of the Federal Reserve on interest rates also play an important role. Market experts suggest that the Fed may reduce borrowing costs for the third consecutive meeting in December. However, uncertainty remains, as any delay in rate cuts could impact gold prices.

Dr Renisha Chainani, Head of Research at Augmont, highlighted that gold has recently taken back 50% of its rally, moving from an overbought zone to an oversold zone. He expects gold prices to continue rising and potentially reach Rs 76,500.

“According to CME Fedwatch tool data, investors have recently reduced the 82% probability of an imminent decline of 25 basis points (bps) to 62%. Gold has retraced 50% of this rally from Rs 67500 to Rs 80000 , and prices have moved from an overbought area to an oversold area,” she said.

Market Predictions – Rahul Kalantri, vice president of commodities at Mehta Equities Ltd., cited a Goldman Sachs report that projected gold prices to reach $3,000 an ounce by December 2025. While this boosts sentiment, immediate gains could be offset by concerns over Fed rate delays.

In rupee terms, gold is expected to take support at Rs 74,880-74,750 and face resistance at Rs 75,310-75,540. Similarly, silver has support at Rs 90,080 to Rs 89,550 and resistance at Rs 91,350 to Rs 91,980.