Silver prices slide ahead of US Inflation data, firm dollar

In the futures market, silver for July delivery touched an intraday high of Rs 71,570 and a low of Rs 71,257 per kg on the MCX.

Silver prices edged lower on June 10 as investors looked forward to US inflation data that could shape the course of the Federal Reserve’s monetary policy. The precious metal was weighed down by softness in gold, industrial metals and a stronger dollar.

The semi-precious metal has been trading higher than 50, 100 and 200 days’ moving averages but lower than the 5 and 20 days’ moving average on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 51.68, which indicates sideways movement in the price.

United States CPI data for May, which is scheduled to be released later in the day, will be keenly watched after April CPI’s reading showed the largest monthly gain in core inflation since 2008 (up 4.2 percent from a year earlier).

Silver holdings in iShares ETF remained unchanged at 17,953.80 tonnes. The fund NAV is trading at a discount of 0.36 percent.

The US dollar index rose to 90.18, up 0.07 percent against the major cross.

The spot gold/silver ratio currently stands at 67.92 to 1 indicating that silver has outperformed gold. The ratio is testing the support level at the 50 EMA at 67.90.

MCX Bulldesk modestly slumped 75 points or 0.49 percent, at 15,160 at 15:13. The index tracks the real-time performance of MCX Gold and MCX Silver futures.

“Technically, LBMA Silver resistance zone is at $28.20-$28.75 levels. Support is at $27.10-$26.70 levels. Domestic silver prices are trading in the red on Thursday early afternoon trade, tracking overseas prices”, said Sriram Iyer, Senior Research Analyst at Reliance Securities

“Technically, MCX Silver July holds support near Rs 71,000 - Rs 70,100 levels. Resistance is at Rs 72,800 - Rs 73,300 levels”, he added.

In the futures market, silver for July delivery touched an intraday high of Rs 71,570 and a low of Rs 71,257 per kg on the MCX. So far in the current series, the precious metal has touched a low of Rs 63,456 and a high of Rs 74,222.

Silver delivery for the July contract declined Rs 406, or 0.56 percent to Rs 71,478 per kg at 15:16 hours with a business turnover of 11,010 lots. The same for the September contract slipped Rs 372, or 0.51 percent, to Rs 72,650 per kg with a turnover of 1,165 lots.

The value of July and September’s contracts traded so far is Rs 933.71 crore and Rs 77.97 crore, respectively.

Similarly, the Silver Mini contract for June tumbled Rs 421, or 0.59 percent at Rs 71,482 on a business turnover of 12,643 lots.

At 09:49 (GMT), the precious metal was down 0.75 percent and was quoting at $27.79 an ounce in New York.

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