Why Are Gold and Silver Prices Falling Amid Profit Booking?
Synopsis
On January 13, gold and silver prices experienced a decline due to profit booking after reaching record highs influenced by US political tensions. This article delves into the factors affecting these precious metals, including economic indicators and geopolitical events, offering insights for investors navigating the market.
Key Takeaways
Gold and silver prices have decreased due to profit booking.
Gold is currently priced at Rs 1,40,482 per 10 grams.
Silver is trading at Rs 2,68,926 per kg.
Geopolitical tensions impact investor behavior towards precious metals.
Analysts suggest a potential bullish outlook for silver in the coming years.
Mumbai, Jan 13 (NationPress) The prices of gold and silver took a downturn on Tuesday as investors engaged in profit booking, following a significant surge to record highs, spurred by concerns surrounding the actions of the US Justice Department against the Federal Reserve Chair.
MCX gold futures for February dropped by 0.44 percent, settling at Rs 1,41,400 per 10 grams around 1:15 PM. Meanwhile, MCX silver futures for March remained relatively stable, displaying a slight decline of 0.01 percent at Rs 2,68,926 per kg.
According to the India Bullion and Jewellers Association (IBJA), the price of 10 grams of 24-carat gold was recorded at Rs 1,40,482, a slight decrease from the previous day's closing price of Rs 1,40,499.
Gold prices had previously surpassed $4,600 per ounce, marking a historic milestone before the onset of profit-taking by investors.
This price rally was fueled by US President Trump’s announcement of a 25 percent tariff on countries trading with Iran, coupled with warnings of potential military action as protests escalated.
The market is currently fixated on the ongoing criminal investigation into Fed Chair Jerome Powell’s statements, which he has described as politically motivated pressure aiming to enforce rate reductions, as mentioned by Rahul Kalantri, VP Commodities at Mehta Equities Ltd.
Investors are also looking forward to crucial US inflation data that could provide insights into future policy directions. Although interest rates are expected to remain steady this month, analysts anticipate two rate cuts later in the year.
The recent US jobs report indicated weaker-than-expected payroll growth, reinforcing the sentiment that the Federal Reserve may implement additional interest rate cuts this year.
Protests in Iran have led the markets to evaluate the potential for political instability and its possible repercussions on oil supplies.
Additionally, the ongoing conflict in Ukraine and renewed US aspirations regarding Greenland further bolster the current market rally.
“Gold has established support levels at Rs 1,39,550 to 1,37,310 and resistance at Rs 1,44,350 to 1,46,670. Silver shows support at Rs 2,60,810 to 2,54,170 with resistance at Rs 2,71,810 to 2,74,470,” analysts stated.
Silver continues to display a robust structural bias, with medium-term targets projected above $100 by 2026, driven by ongoing supply deficits and increasing demand from industrial and green-energy sectors.
Point of View
It is crucial to approach market fluctuations with a balanced perspective. The recent decline in gold and silver prices highlights the ongoing tension between investor sentiment and broader economic factors. As we navigate these changes, we remain committed to providing our audience with clear and accurate information to support informed decision-making.
NationPress
10 May 2026
Frequently Asked Questions
What caused the recent drop in gold and silver prices?
The recent drop in gold and silver prices is primarily attributed to profit booking by investors after the metals reached record high levels amid geopolitical tensions and economic uncertainties.
What are the current price levels for gold and silver?
As of January 13, gold is priced at Rs 1,40,482 per 10 grams, while silver is at Rs 2,68,926 per kg.
How do geopolitical events affect gold and silver prices?
Geopolitical events create uncertainty, leading investors to buy gold and silver as safe-haven assets. However, once prices surge, profit booking can lead to price corrections.
What is the outlook for gold and silver prices in 2026?
Analysts predict that silver may reach targets above $100 by 2026, driven by supply deficits and rising demand from industrial and green-energy applications.
Are there any support and resistance levels for gold and silver?
Yes, gold has support at Rs 1,39,550 to 1,37,310 and resistance at Rs 1,44,350 to 1,46,670. Silver has support at Rs 2,60,810 to 2,54,170 and resistance at Rs 2,71,810 to 2,74,470.
