Gold February futures contract settled at Rs 56,324 per 10 grams with a gain of 0.80% and the silver March futures contract settled at Rs 69,427 per kilogram with a gain of 1.17%.
Gold and silver extended its gain last week after cooling off US inflation and weakness in the dollar index. The US inflation in the month of December slipped to 6.5% on yearly basis, against 7.1% in November.
The dollar index slipped to seven-month lows and slipped below 102 marks. The US 10-year bond yields also slipped below 3.50% amid expectations of a slower pace of US Fed rate hikes.
Gold prices hit a 9-month high in the international markets and crossed $1,900 per troy ounce. Silver prices also crossed its major resistance of $24.40 per troy ounce on a weekly closing basis.
Gold prices in the domestic markets hit a lifetime high and closed above Rs 56,300 level for the first time in its history last week.
Looking at the fundamentals and weakness in the dollar, gold and silver could maintain its bullish momentum in the upcoming sessions.
Buy on dips strategy is suggested in precious metals. Gold has support at $1908-1792, while resistance at $1934-1948 per troy ounce. Silver has support at $24.10-23.84, while resistance is at $24.74-25.10 per troy ounce.
, gold has support at Rs 56,100-55,880 and resistance at Rs 56,500-56,750 while silver has support at Rs 68,900-68,350 and resistance is placed at Rs 69,950-70,500.
We suggest buying silver above Rs 69,500 with a stop loss of Rs 68,850 for the target of Rs 70,700.
(The author is Head-Commodity and Currency Research at Finmart)
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)