Gold Price Declines on MCX Amid Profit Booking and Ongoing US-Iran Diplomatic Tensions

Gold Prices Decline on MCX Amid Profit Booking and US-Iran Talks Uncertainty

On Tuesday, 21 April, gold prices on the Multi Commodity Exchange (MCX) declined in early deals due to profit booking amid an uptick in the US dollar. The uncertainty surrounding the proposed US-Iran talks continued to weigh on crude oil prices, keeping them at elevated levels and impacting gold prices.

As of 9:10 am, MCX gold June futures were 0.07% down at ₹1,53,829 per 10 grams, while MCX silver May contracts were 0.69% down at ₹2,50,801 per kg.

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The rise in the US dollar, driven by a spike in crude oil prices, has been a major factor in the volatility of gold and silver rates. When oil prices increase, demand for the dollar rises, as oil is largely traded in US dollars, which in turn weighs on gold prices. Despite a slight easing of Brent Crude oil prices, they continue to trade near $95 a barrel.

Higher crude prices raise inflationary risks with increased transportation and production costs, dimming the prospects of interest rate cuts. This makes yield-bearing assets, such as fixed deposits and bonds, more attractive, weighing on non-yield-bearing gold prices.

The focus is on the possible talks between the US and Iran as the two-week ceasefire is set to expire this week. US President Donald Trump hinted on 20 April that the ceasefire between Washington and Tehran may not be extended. Meanwhile, Axios reported that Vice President JD Vance may depart for Islamabad by 21 April morning to resume negotiations with Iran. Reuters reported that Iran is considering attending peace talks with the US in Pakistan.

MCX Gold and Silver Support and Resistance Levels

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According to Manoj Kumar Jain of Prithvifinmart Commodity Research, the sentiment looks weak in the global markets, and MCX gold June futures may drop to ₹1,53,000 per 10 grams. Jain maintains a buy on dips strategy in gold until it holds ₹1,48,000 on a closing basis for the target of ₹1,55,500 and ₹1,57,000, and silver until it holds ₹2,45,000 on a closing basis for the targets of ₹2,59,100 and ₹2,61,600.