Silver prices dipped on August 30 amid choppy trade in dollar and gold as the US Federal Reserve chief Jerome Powell did not provide any clear hint on the timeline of reducing economic support at the Jackson Hole symposium. The precious metal had risen 3.02 percent last week on the MCX.
The white metal extended losses to trade at day’s low after a gap-down start in the afternoon session, tracking the weak global cues.
The semi-precious metal has been trading higher than 5 and 20 days’ moving averages but lower than the 50, 100 and 200 days’ moving averages on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 45.69, which suggests a sideways trend in the price.
Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research said, “The Fed chairman stuck to his mantra that inflation is just temporary. The dollar fell as US Treasury rates fell, consumer confidence weakened and inflation forecasts fell. Powell hinted to the markets that the Fed may begin reducing its bond-buying program in 2021.”
“MCX Silver December contract has formed a Symmetric triangle pattern and past few sessions remained within a channel with some downside corrections. The mint ratio, which is also called as Gold/silver ratio declined to 75.50 which is a positive sign for silver price,” Purohit noted.
Silver holdings in iShares ETF were unchanged for the third day at 16,978.71 tonnes, the lowest since November 2020. The fund NAV is trading at a premium of 2.10 percent.
The US dollar index traded slightly higher at 92.72, up 0.03 percent against the major cross in the afternoon session.
The spot gold-silver ratio stands at 75.58 to 1, indicating that silver has outperformed gold.
MCX Bulldesk decreased by 48 points, or 0.34 percent, to 14,225 at 3:33 pm. The index tracks the real-time performance of MCX Gold and MCX Silver futures.
In the futures market, September silver delivery touched an intraday high of Rs 63,706 and a low of Rs 63,309 per kg on the MCX. So far in the current series, the precious metal has touched a low of Rs 61,227 and a high of Rs 75,215.
Silver delivery for the September contract dropped Rs 235, or 0.37 percent, to Rs 63,350 per kg at 3:29 pm with a business turnover of 1,354 lots. The same for December slipped Rs 290, or 0.45 percent, to Rs 63,773 per kg with a turnover of 9,448 lots.
The value of September and December’s contracts traded, so far, is Rs 2.13 crore and Rs 580.85 crore, respectively.
Similarly, the Silver Mini contract for November declined Rs 192, or 0.30 percent to Rs 64,067 on a business turnover of 18,817 lots.
At 1002 (GMT), the precious metal fell 0.20 percent and was quoting at $24.06 an ounce in New York.
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