Buy MCX Silver December; target of Rs 54500-56000

New Delhi-India (Oct 24)  Silver declined from 50,100 to 45,950 last week but it continued to lose downside momentum. Further, the structure of this fall suggests that it's merely a correction. Accordingly we expect the loss to be limited as Silver prices have displayed the Major Triangle breakout in the daily charts . Sustainable two consecutive daily closings above 50,200 indicates a pull back at 53,000 and turn the near term outlook to bullish. A breakout in RSI and an increase in volumes on the day of the breakout further support bullish momentum in the commodity. The next major trend line support is at 47,800.A closing below the trend line would then suggest a possible downside near 46,000-45,000. On the upside, a movement above 50,200 will indicate short term bottoming and bring about a rebound which can take the price to 54,500-56,000 levels. The preferred strategy favours buying MCX Silver December above Rs 50,200 for the target of Rs 54,500-56,000 with a stoploss of Rs 47,800.