MCX Silver bullish; short covering expected for the day

MUMBAI-INDIA (July 23)  The trend in silver futures for September delivery on India's Multi Commodity Exchange (MCX) looks bullish and intra-day trader are advised to buy on dips. The white metal may witness short covering at end of the day.

“For intra-day, support for the commodity is seen at 41500 while 42500 is the resistance. The prices are expected remain positive for the day,” according to our analyst at Commodity Online.

MCX silver futures for September delivery was seen trading down by 0.70% at Rs. 41939 per kilogram as of 06.04 PM IST on Tuesday.

Bullion in the international edged up on Tuesday and was seen trading up supported by the weak US Dollar and strong buying from China. The yellow metal was also supported by the recent comments from the US Federal Reserve Chairman Ben Bernanke.

Silver futures for September delivery on Globex platform of Comex was seen trading down by 1.59% at $20.178 per troy ounce as of 06.11 PM IST on Monday.

US House Price Index is scheduled to be released at 06.30 PM IST while Eurozone Consumer Confidence data is expected at 07.30 PM IST today.

Bullion prices in the global market were also supported by an unexpected decline in US home sales. In the United States, existing-home sales declined in June but have stayed well above year-ago levels for the past two years, while the median price shows seven straight months of double-digit year-over-year increases, according to the data released by the National Association of Realtors on Monday.

Total existing-home sales, which are completed transactions that include single-family homes, town homes, condominiums and co-ops, dipped 1.2 percent to a seasonally adjusted annual rate of 5.08 mn in June from a downwardly revised 5.14 mn in May, but are 15.2 percent higher than the 4.41 mn unit level in June 2012.