Gold rates experienced a decline in the domestic futures market on Thursday, January 22, during morning trading hours. This downward movement was primarily driven by profit booking activities among traders and investors, occurring alongside signs of reduced geopolitical tensions and a strengthening US dollar against other major currencies.
Market Performance Details
On the Multi Commodity Exchange (MCX), gold February futures were trading 0.46% lower at approximately ₹1,52,158 per 10 grams around 9:35 am. In contrast, MCX silver March futures showed resilience, gaining 0.25% to reach ₹3,19,301 per kilogram at the same time. The silver market benefited from healthy demand in the spot market, providing support against broader negative sentiment.
International Factors Influencing Prices
The yellow metal also faced pressure in international markets following comments from US President Donald Trump regarding Greenland. Trump softened his previously aggressive tone about the island territory, which contributed to reduced safe-haven demand for gold. US gold futures for February delivery declined by 1% in response to these developments.
President Trump stepped back from earlier threats to impose tariffs on European countries concerning their position on Greenland. He announced that he had established the preliminary framework for an agreement with NATO regarding the future of the island, following discussions with NATO Secretary General Mark Rutte.
Dollar Strength and Economic Indicators
Trump's more conciliatory approach toward tariffs helped stabilize and strengthen the US dollar. The dollar index climbed to 98.81, making gold more expensive for buyers using other currencies and adding downward pressure on international gold prices.
Beyond geopolitical developments, market participants are closely monitoring upcoming economic data releases. The November Personal Consumption Expenditures (PCE) data—the Federal Reserve's preferred inflation measure—and weekly jobless claims figures, both scheduled for release later in the day, are expected to influence expectations about the US central bank's interest rate path. Most analysts anticipate the Federal Reserve will maintain current interest rates at its January 27-28 policy meeting.
Analyst Perspectives and Market Outlook
Manoj Kumar Jain of Prithvifinmart Commodity Research observed that gold and silver prices are experiencing profit-taking amid risk aversion in global financial markets following President Trump's comments. However, Jain noted that ongoing global uncertainty stemming from US trade policies and Western economic narratives could continue to support safe-haven buying of precious metals over the longer term.
"We expect gold and silver prices to remain volatile this week amid fluctuations in the dollar index, ahead of US jobless claims data and ongoing geopolitical tensions," stated Jain.
Technical Levels and Trading Recommendations
According to Jain's analysis, gold faces support levels at $4,785 and $4,740 per troy ounce, with resistance at $4,855 and $4,890. For silver, support is identified at $89.80 and $87.40, while resistance stands at $94.60 and $96.80 per troy ounce during Thursday's trading session.
On the MCX platform, Jain indicated gold has support at ₹1,50,500 and ₹1,47,700, with resistance at ₹1,55,000 and ₹1,58,000. Silver shows support at ₹3,14,000 and ₹3,06,000, with resistance at ₹3,24,000 and ₹3,28,000.
"We suggest staying away from taking fresh positions in both precious metals in today's session and waiting for some stability in the markets," advised Jain.
Jigar Trivedi, Senior Research Analyst at Reliance Securities, offered additional perspective, noting that MCX gold February futures could potentially decline further to ₹1,51,500 per 10 grams given the mildly weak undertone in global markets. Trivedi believes MCX silver March futures might retreat to ₹3,15,000 per kilogram if corrective pressure persists throughout the trading day.
Market participants are advised to exercise caution and consult with certified financial experts before making investment decisions, as market conditions remain fluid and subject to rapid changes based on geopolitical developments, economic data releases, and currency fluctuations.
