Gold and silver prices on the Multi Commodity Exchange of India (MCX) surged sharply on Friday, supported by heightened safe-haven demand amid escalating geopolitical tensions in the Middle East. Following fresh Israeli attacks on Iran and the US military involvement, bullion markets are expected to remain sensitive to further developments when trading resumes next week.
Israel said that it had launched a pre-emptive strike against Iran on Saturday, diminishing prospects for a diplomatic resolution to Tehran’s long-standing nuclear dispute with Western nations.
Regional tensions intensified further after explosions were reported in Abu Dhabi and Dubai in the United Arab Emirates (UAE), as well as in Doha and Riyadh, hours after Israel and the United States described their actions as “major combat operations” against Iran.
The escalating geopolitical conflict is likely to reinforce safe-haven flows into precious metals. MCX gold rate settled sharply higher near ₹1.62 lakh per 10 grams on Friday, while MCX silver rate surged over 5% to close around. ₹2.82 lakh per kilogram.
In international markets, gold and silver prices also rallied as reports of a US military buildup in the Middle East unsettled investors and boosted safe-haven demand. Gold prices have risen more than 20% in February, marking a seventh consecutive monthly gain — the longest such streak since 1973.
Can MCX gold price reach ₹2 lakh and MCX silver price hit ₹3 lakh?
Regarding US-Iran tensions, Yaha Chauhan, Research Analyst, INVasset PMS said that the geopolitics adds a risk premium to bullion, particularly through crude-led inflation fears and currency volatility.
MCX gold rate at ₹2 lakh per 10 grams and silver rate at ₹3 lakh per kg cannot be ruled out in an extreme escalation scenario, especially if crude spikes sharply and the rupee weakens. However, such levels would require sustained geopolitical stress and global liquidity support,” said Chauhan.
He believes that gold and silver prices remain in a strong structural uptrend, but expects sharp volatility alongside momentum.
Technical View
Gold and silver prices are exhibiting constructive technical setups, supported by firm demand at higher bases. MCX gold price has extended its upward trajectory after resolving the prior consolidation range, now trading firmly above the ₹1,60,000 structural pivot.
“The earlier falling channel resistance has been decisively breached, converting prior supply into short-term support. MCX gold price is currently stabilizing near ₹1,62,000 after registering fresh swing highs. The ₹1,59,500 – ₹1,60,000 zone now acts as immediate demand following breakout acceptance. Momentum structure reflects higher highs and higher lows on the hourly framework, suggesting trend continuation rather than exhaustion,” said Ponmudi R, CEO of Enrich Money.
According to him, sustained holding above ₹1,60,000 opens upside potential towards ₹1,63,500 – ₹1,65,000, while structural invalidation emerges only on a decisive breakdown below ₹1,58,000, which would disrupt the current higher-low sequence.
Meanwhile, MCX silver price has delivered a strong impulsive breakout, clearing the prior consolidation ceiling and accelerating towards the ₹2,80,000 – ₹2,85,000 band, a move which reflects momentum-driven participation rather than slow accumulation, supported by expanding price range.
“The ₹2,72,000 – ₹2,75,000 zone now transitions into a demand base after breakout confirmation. Silver price action indicates strength with shallow pullbacks, suggesting accumulation on dips. Sustained trade above ₹2,85,000 may trigger continuation towards ₹2,90,000 – ₹2,95,000,” said Ponmudi R.
However, failure to hold ₹2,72,000 would introduce corrective rotation, but structural weakness becomes relevant only below ₹2,65,000, he added.
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Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
