Mumbai, Nov 24 Gold prices fell sharply on Monday as weak chances of a US Federal Reserve rate cut and easing geopolitical tensions weighed on investor sentiment.
A stronger US dollar also added pressure on the precious metal.
On the Multi Commodity Exchange (MCX), gold December futures dropped 1 per cent to Rs 1,22,950 per 10 grams.
Silver followed the trend, with December futures falling 0.61 per cent to Rs 1,53,209 per kg in early trade.
“In INR gold has support at Rs1,23,450-1,22,480 while resistance at Rs1,24,750-1,25,500,” analysts said.
“Silver has support at Rs1,53,050-1,52,350 while resistance at Rs1,55,140, 1,55,980,” they added.
Analysts said gold currently lacks any strong positive trigger to maintain its previous gains.
The latest US job market data reduced expectations of a 25-basis-point rate cut by the Federal Reserve in December, which has been a key reason behind the correction in prices.
The strong economic data pushed the US dollar index to nearly a six-month high on Friday.
The index remained above the 100 level on Monday, making gold more expensive for buyers holding other currencies and restricting demand.
Geopolitical concerns have also eased in recent days, further reducing gold’s safe-haven appeal.
Experts believe the combination of a stronger dollar, uncertainty over US tariff decisions, developments in the Russia-Ukraine conflict, and the upcoming Fed policy announcement may keep gold prices volatile in the near term.
Some market analysts expect further correction and advise investors to stay cautious before making fresh purchases.
Gold is attempting to reclaim momentum as prices hover near $4,100, driven by growing expectations of a December Fed rate cut, now priced at 71 per cent probability after dovish hints from officials like Miran and Williams.
“Bullion has been choppy over the past three sessions, reflecting traders’ indecision, but with rate-cut bets rising and geopolitical risks lingering, dips in gold are likely to attract renewed buying interest in the coming week with next resistance seen around 125000 and support near 122000,” experts added.
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