Bullion Holds Steady After Previous Session Decline
Gold and silver prices stabilized in early trade on Wednesday, February 25, following a sharp decline in the previous session, as strength in the US dollar limited further upside and reduced demand for safe-haven assets.Spot gold was trading near $5,146.18 per ounce at 0054 GMT. Earlier this week, the metal had climbed to a more than three week high before retreating over 1 percent on Tuesday after touching that peak during early Asian trading hours. US gold futures for April delivery slipped 0.2 percent to $5,165 per ounce.
Silver also saw mild pressure. Spot silver eased 0.2 percent to $87.13 per ounce after reaching a more than two week high on Monday.
Stronger US Dollar Weighs on Precious Metals
The US dollar index edged up 0.02 percent, extending gains from the previous session. A firmer dollar typically makes dollar-denominated commodities more expensive for overseas buyers, which in turn limits demand and caps price gains in gold and silver.Two US Federal Reserve officials indicated that there would be no immediate change in interest rate settings. Despite this, markets are currently pricing in three 25 basis point rate cuts this year, according to CME’s FedWatch tool. Expectations of easing monetary conditions generally support non-yielding assets such as gold over the medium term.
Global Equity Rally Reduces Safe Haven Appeal
Global equities advanced amid renewed optimism surrounding artificial intelligence driven business growth. The improvement in risk sentiment somewhat reduced the immediate appeal of safe-haven assets, including gold.Domestic Market Levels: Key Support and Resistance
In the domestic market, Jateen Trivedi, VP Research Analyst for Commodity and Currency at LKP Securities, identified key technical levels for the April gold contract. He placed support near ₹1.58 lakh per 10 grams and resistance around ₹1.62 lakh per 10 grams.He noted that volatility is likely to remain elevated due to ongoing geopolitical developments. Any escalation or breakdown in talks could quickly revive demand for safe-haven assets, influencing short term price movements in bullion.
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