Gold, Silver Prices Slump as US-Iran Tensions Fuel Crude Oil Rally
Bullion prices faced a downward trajectory during early trade on July 17 as renewed tensions between the US and Iran kept both the US dollar and crude oil prices at elevated levels.The international spot gold market saw a 0.25 percent decline to $3,982.30 per ounce. Simultaneously, silver prices edged down by 0.28 percent to reach $57.27 per ounce during morning trades on Comex.
On the domestic front, MCX gold futures for the August contract ended Thursday's trade with a significant 1.16 percent decline to Rs 1,40,209 per 10 grams. Silver futures for the September contract also saw a slight pullback of 0.16 percent, closing at Rs 2,15,665 per kilogram.
Geopolitical Friction and Crude Oil Influence on Bullion Sentiment
Market participants are expected to remain vigilant toward geopolitical developments and energy price fluctuations to determine fresh market direction. The ongoing friction in the Middle East continues to weigh heavily on investor sentiment.Jateen Trivedi, VP Research Analyst - Commodity and Currency at LKP Securities, noted that persistent uncertainty surrounding the US-Iran conflict maintains a cautious sentiment for bullion. He highlighted that concerns over elevated crude oil prices potentially fueling inflation remain a primary concern for investors.
While recent US CPI data showed softer figures due to lower energy prices during May and June, the analyst warned that sustained strength in crude could revive inflationary pressures. This dynamic is expected to influence the Federal Reserve's policy outlook and affect metal pricing.
Technical Outlook and Market Range Projections
From a technical perspective, analysts suggest that MCX Gold is expected to trade within a specific corridor for the near term. The projected range for gold is between Rs 1,40,000 and Rs 1,43,000.Volatility is anticipated to remain elevated as traders navigate the interplay between geopolitical news and domestic demand. Investors are closely monitoring the reports for any sudden shifts in supply or global demand dynamics that could break the current trading range.
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