Silver futures trade firm at Rs 61,080/kg, faces resistance near Rs 62,000 levels

Silver prices soared to Rs 61,080/kg on October 14 as participants increased their long positions.

The precious metal had slipped 4.5 percent on the COMEX on October 13 amid a sharp correction in gold and weakness in industrial metals. The rebound in the US Dollar Index from recent lows put pressure on commodities at large. The Dollar Index is trading firm at 93.64 levels, up 0.11 percent.

Silver holdings in iShares ETF jumped 144.7 tonne to 17,527.43 tonne, its highest level since September 29.

The spot gold-to-silver ratio currently stands at 78.49 to 1, indicating that gold has outperformed silver. Experts told Moneycontrol that this ratio continues to be at its highest, indicating cheaper silver prices.

Sriram Iyer, Senior Research Analyst at Reliance Securities, feels the upside may be capped as the dollar remained firm on October 14. "Technically, LBMA Silver Spot is trading below its 21 and 50-Daily Moving Average, indicating a negative trend in the counter in the short run. Resistance and support is placed at $24.50-25.20 and $23.80-$22.90 levels, respectively."

Technically, MCX Silver December faces resistance near Rs 62,000 levels, below which one could continue to witness sideways to marginal downside momentum down to Rs 59,500-57,600 levels, Iyer said.

Anuj Gupta, DVP- Commodities and Currencies Research, Angel Broking, too advises a sell in silver for day traders. “Traders can sell at Rs 61,200 levels, with the stop loss of Rs 61,700 levels, for a target of Rs 59,800.”

Sunand Subramanian, Senior Research Associates at Choice Broking, expects MCX Silver price to trade bullish in the coming month as industrial demand recovers and business activity resumes globally.

MCX iCOMDEX Bullion Index rose 46.36 points, or 0.30 percent, at 15,408.58 at 15:17 hours. The index tracks the real-time performance of MCX Gold and MCX Silver futures.

In the futures market, silver for December delivery touched an intraday high of Rs 61,250 and a low of Rs 60,601 per kg on the Multi-Commodity Exchange (MCX). So far in the current series, the precious metal has touched a low of Rs 49,415 and a high of Rs 79,723.

Silver futures for December delivery gained Rs 538, or 0.89 percent, to Rs 61,080 per kg at 15:18 hours on a business turnover of 15,887 lots. The same for March delivery edged higher by Rs 406, or 0.65 percent, to Rs 62,840 per kg on a turnover of 927 lots.

The value of December and March’s contracts traded so far is Rs 1,264.09 crore and Rs 12.23 crore, respectively.

At 09:53 (GMT), the precious metal was up 0.65 percent at $24.28 an ounce in New York.

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