India gold futures, which traded flat on Monday, are likely to fall this week in tandem with equities, and as traders book profits from last week's peak. Silver may fall 2.5 percent to their lowest level in a month.

The most-active gold for December delivery on the Multi Commodity Exchange (MCX) was 0.26 percent lower at 28,630 rupees per 10 grams weighed by weak global markets, although a weaker rupee kept the downside in prices limited. The contract fell 0.4 percent last week after hitting a peak of 29,212 rupees on Tuesday.



Gold is co-related with equities strongly at present. Markets are trying to remain in cash during this credit crisis. So, they are also selling gold and converting it to cash, said Gnanasekar Thiagarajan, director with Mumbai-based Commtrendz Research.

The Sensex has fallen more than 9.5 percent since the start of November. Sell gold on rallies to 28,850-28,900, with a stop loss of 29,100, with a target of 28,400, said Thiagarajan.

Traders will eye the movement in the rupee, which hit a record low in Monday's trade and plays an important role in determining the landed cost of the dollar-quoted yellow metal. Expectations of weak physical buying in the middle of wedding season, which will last through December, is also expected to weigh on prices.

Silver futures may fall more than 2.5 percent this week to their lowest level in a month, tracking the yellow metal and sagging copper.

Silver for December delivery on the MCX was down 2.68 percent at 54,355 rupees per kg. The contract had struck a low of 53,000 rupees on Oct. 21. Sell silver on 56,200/56,500 rupees, for a target of 53,000, with a stop loss of 57,800 rupees, said Ramesh Chenchala, technical analyst with Karvy Comtrade.