Silver prices edged higher to Rs 70,120 per kg on January 4 as participants increased their long positions as seen by the open interest. The precious metal had declined 1.01 percent last week on the MCX.
Silver prices traded firm tracking gains in gold prices, improving demand outlook for the industrial sector, and weakness in the dollar index.
The US dollar index traded lower at 89.42 levels, down 0.53 percent in the afternoon trade.
Silver holdings in iShares ETF rose 52.03 tonnes to 17,378.01 tonnes.
MCX iCOMDEX Bullion Index surged 311.27 points, or up 1.98 percent, at 15,999.03 at 15:50. The index tracks the real-time performance of MCX Gold and MCX Silver futures.
Sriram Iyer, Senior Research Analyst at Reliance Securities said, “International silver prices are trading with gains on Monday morning and early afternoon in Asia supported by safe-haven appeal and a weak dollar. The gold-silver ratio fell this Monday morning and early afternoon in Asia suggesting that gold is currently underperforming against silver.”
“Technically, LBMA Silver Spot has given a strong breakout above $27.00 levels indicating a positive momentum up to $27.30-$28.20 levels. Support is at $26.30-$25.80 levels”, he said.
In the futures market, silver for March delivery touched an intraday high of Rs 70,345 and a low of Rs 68,499 per kg on the MCX. So far in the current series, the precious metal has touched a low of Rs 54,386 and a high of Rs 79,980.
Silver delivery for March contract gained Rs 1,997, or 2.93 percent to Rs 70,120 per kg at 15:53 hours with a business turnover of 15,936 lots. The same for the May contract jumped Rs 2,090, or 3.03 percent, to Rs 71,158 per kg with a turnover of 710 lots.
The value of March and May’s contracts traded so far is Rs 2,220.71 crore and Rs 33.31 crore, respectively.
The spot gold/silver ratio currently stands at 70.79 to 1 indicating that silver has outperformed gold.
“Technically, MCX Silver March has given a breakout above Rs 69,000 levels indicating a positive momentum up to Rs 70,600-72,700 levels with support placed at Rs 69,000-68,200 levels, said Iyer.
At 09:36 (GMT), the precious metal climbed 3.82 percent to quote at $27.42 an ounce in New York.
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