Gold and silver prices fell on Tuesday, November 3, as international market weakness hit precious metals. Gold futures dropped by Rs 1,300, while silver slipped by Rs 4,600. Ponmudi R of Enrich Money said, "MCX gold is facing near-term weakness after failing to sustain above Rs 1,40,000." Investors remain very cautious.

Gold and silver prices declined on Tuesday, November 3, after a brief rebound in the previous session, as weakness in international bullion markets weighed on precious metals despite the approaching festive season.

Gold futures fell more than Rs 1,300 per 10 grams, while silver declined over Rs 4,600 per kg, as investors remained cautious ahead of the US midterm election results and assessed the outlook for interest rates.

On the Multi Commodity Exchange (MCX), December gold futures were trading at Rs 1,39,026 per 10 grams, down Rs 1,160, or 0.83%, as of 10:31 a.m. However, earlier in the day, the futures touched a low of Rs 1,38,800, declining by around Rs 1,386.

December silver futures declined Rs 4,622, or 2.51%, to Rs 1,79,157 per kg after the market opened, against the previous close of Rs 1,83,779, again slipping below the Rs 1,80,000 mark. At around 10:33, the white metal is trading at Rs 1,79,434 per kg, losing around 2.36% or Rs 4,345.

Why Are Gold And Silver Prices Falling?

International bullion prices came under pressure ahead of the outcome of the US midterm elections. Spot gold price fell 0.5% to $3,926.52 per ounce, while spot silver dropped 1.8% to $49.71 per ounce.

Gold prices are also facing pressure from expectations of higher US interest rates. Markets are pricing in a 74% probability of a Federal Reserve rate hike in December, making non-yielding assets such as gold less attractive.

Technical Outlook

Ponmudi R, CEO of Enrich Money, said MCX gold is facing near-term weakness after failing to sustain above Rs 1,40,000. The yellow metal has immediate support at Rs 1,37,500 to Rs 1,38,300. A sustained recovery above Rs 1,40,000 to Rs 1,41,000 is needed to stabilise the price trend, while a decisive break below the immediate support could push prices towards Rs 1,34,000 to Rs 1,35,000. The RSI, near 32, and a widening negative MACD histogram indicate continued bearish momentum. A firmer rupee is also weighing on domestic gold prices.

Silver has declined more than gold, with MCX futures' immediate support zone at Rs 1,78,000 to Rs 1,80,000. According to Ponmudi, a break below this range could expose prices to a further decline towards Rs 1,70,000 to Rs 1,72,000. On the upside, Rs 1,86,000 to Rs 1,88,000 remains the immediate resistance zone, followed by Rs 1,94,000 to Rs 1,96,000.

RSI is near 23, indicating deeply oversold conditions; however, the widening negative MACD histogram suggests selling pressure is yet to ease.