Silver offers buying opportunities for investors. Silver at the MCX was priced at Rs 95,600 per kg on Tuesday
Chennai: With gold prices remaining sky-high, investors should wait for the next correction to buy the yellow metal. Instead, they should look at accumulating its cheaper cousin silver as the gold-silver ratio supports the white metal.
While several geo-political and geo-economic factors are supporting gold prices in the medium term, the ongoing tariff war is responsible for the prices rising sharply.
“Any move by the US and China to alleviate the trade tension could see a correction in gold prices,” said Ajay Kedia, MD, Kedia Commodities.
In the international market, gold has an immediate resistance of $3500 per ounce, followed by $3640. The support level is seen at $3020. In MCX, the support level is Rs 93,000 per 10 gm and resistance at Rs 1,03000.
“At the current levels, investors can look at profit-booking of smaller quantities of gold. However, investors should wait for corrections for purchases,” he said.
Meanwhile, silver offers buying opportunities for investors. Silver at the MCX was priced at Rs 95,600 per kg on Tuesday. The gold-silver ratio has gone up above 100. Gold-silver ratio - the number ounces of silver needed to buy one ounce of gold – has earlier gone up above 100 only once to 126 during the pandemic.
Usually, the gold-silver ratio remains around 65-70 levels, moving between 32 and 85. Once the ratio moves up, there will be pressure on silver prices to rise.
Further, the usage of silver as an industrial metal, in solar and EV equipment is increasing, supporting prices.
