Silver prices slipped below Rs 69,500 per kg on July 16 following weak economic data from China and subdued trends in gold. The precious metal had gained 0.50 percent yesterday on the COMEX.
The white metal pared earlier gains and turn red to trade at day’s low after a gap-up start in the afternoon session.
The semi-precious metal has been trading higher than 20, 100 and 200 days’ simple moving averages but lower than the 5 and 50 days’ moving averages on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 49.99, which indicates neutral movement in the price.
The price has been weighed down by rising tension between the US and China, rising raw material prices and China’s crackdown on big tech firms.
China’s Q2 GDP rose 7.9 percent against an expectation of 8.1 percent growth.
The trend in the US dollar and bond yields may continue to impact gold and silver and the focus for the day will be on economic data like US retail sales, Bank of Japan policy rate and inflation numbers from the Eurozone.
Silver holdings in iShares ETF were unchanged for the fourth day at 17,267.10 tonnes. The fund NAV is trading at a premium of 0.41 percent.
The US dollar index eased to 92.57, down 0.07 percent against the major cross.
Sriram Iyer, Senior Research Analyst at Reliance Securities said, “International silver prices have started flat and turn negative this Friday morning and early afternoon in Asian trade as markets look to fresh triggers. LBMA Silver above the $26.40 level will continue its Bullish momentum and further could see $26.65-$27.20 levels. Support is at $26.10-$25.70 levels.”
“MCX Silver September above Rs 69,500 levels could see a Bullish momentum up to Rs 70,900-71,600 levels. Support is at Rs 69,200-68,500 levels,” he added.
The spot gold/silver ratio currently stands at 69.66 to 1 indicating that gold has outperformed silver.
MCX Bulldesk fell 41 points, or 0.28 percent, to 14,828 at 15:05. The index tracks the real-time performance of MCX Gold and MCX Silver futures.
In the futures market, silver for September delivery touched an intraday high of Rs 69,931 and a low of Rs 69,276 per kg on the MCX. So far in the current series, the precious metal has touched a low of Rs 67,700 and a high of Rs 75,215.
Silver delivery for the September contract dropped Rs 331, or 0.48 percent to Rs 69,350 per kg at 15:06 hours with a business turnover of 10,714 lots. The same for the December contract slumped Rs 262, or 0.37 percent, to Rs 70,600 per kg with a turnover of 530 lots.
The value of September and December’s contracts traded so far is Rs 854.14 crore and Rs 13.38 crore, respectively.
Similarly, the Silver Mini contract for August slides Rs 296, or 0.42 percent at Rs 69,510 on a business turnover of 13,266 lots.
Kotak Securities said silver bulls will have to keep the prices above $26.60-26.65 for it to push further higher. Till then the view remains sideways to choppy as US dollar moves might give a direction to gold that might have an impact on silver prices.
At 09:39 (GMT), the precious metal tumbled 0.53 percent and was quoting at $26.25 an ounce in New York.
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