Silver prices climbed to Rs 70,039 a kg on February 25 with participants reducing positions as seen by the open interest. The precious metal had gained 0.6 percent the previous day on the COMEX.
The white metal traded in the positive territory after a gap-up opening in the afternoon session, tracking dollar weakness.
Silver prices fell sharply on February 24 as US bond yields surged and progress made on the vaccination front but recovered as the Fed’s reiterated its accommodative stance.
The metal has been trading higher than its 5, 20, 50, 100 and 200 day- moving averages on the daily chart. The Relative Strength Index (RSI) is at 54.57, which indicates a positive momentum in prices.
Silver holdings in iShares ETF remained unchanged at 19,272.14 tonnes.
The US dollar index dropped below 90 to trade at 89.81, down 0.39 percent in the afternoon trade.
MCX iCOMDEX Bullion Index, which tracks the real-time performance of MCX gold and silver futures, was up 3.18 points, or 0.02 percent, at 14,880.68 at 1507 hours.
Sriram Iyer, Senior Research Analyst at Reliance Securities said international silver prices were trading in the red. Technically, LBMA spot silver was trading below $29, indicating that a sideways to bearish momentum could continue up to $27.20-$26.40 levels, while resistance is at $29.00-$29.40.
“Domestic silver, on the other hand, is trading higher this Thursday morning and early afternoon trade, bucking overseas prices. Technically, MCX March silver bounced back from Rs 68,650 levels and is trading on a positive note, indicating further upside up to Rs 70,200-71,000 levels. Support is at Rs 69,100-68,400 levels," Iyer said.
He advised buying March silver near Rs 69,200, with a stop loss of Rs 68,600 and for a target of Rs 70,500.
In the futures market, silver for March delivery touched an intraday high of Rs 70,537 and a low of Rs 69,630 per kg. 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 surged Rs 496, or 0.71 percent, to Rs 70,039 per kg at 1513 hours, with a business turnover of 7,320 lots. The same for the May contract gained Rs 560, or 0.79 percent, to Rs 71,367 per kg with a turnover of 8,545 lots.
The value of March and May’s contracts traded, so far, is Rs 1,592.78 crore and Rs 730.94 crore, respectively.
The spot gold/silver ratio stands at 64.05 to 1, indicating that silver has outperformed gold.
Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited, said, “MCX silver downside support at Rs 66,500-63,5 00 levels whereas resistance is at Rs 71,600-74,600 levels.”
Silver may witness choppy trade unless there is a clear trend in gold, however, improving demand outlook may continue to support price, Kotak Securities said.
At 0947 GMT, the precious metal was up 0.52 percent, quoting at $28.01 an ounce in New York.
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