MCX Silver sideways; support 39800, resistance 40500
MUMBAI-INDIA (July 10) The trend in silver futures for September delivery on India's Multi Commodity Exchange (MCX) is sideways.
“For intra-day, support for the commodity is seen at 39800 while 40500 is the resistance. If prices break level of 40500 then the commodity is expected to move towards 41000 and 41500 levels,” said Amrita Mashar, Research Analyst at Commodity Online.
MCX silver futures for September delivery was seen trading down by 0.53% at Rs. 40380 per kilogram as of 05.29 PM IST on Wednesday.
Bullion traders are eyeing on US Federal Reserve's FOMC meeting minutes which are scheduled to be released at 11.30 PM IST today and this would be followed by a speech of Ben Bernanke at 1.40 AM IST, Thursday.
Silver prices are dropped to that extend to start a buy back, analysts said. Silver since the US Fed commented positively on US economic recovery, silver keep falling,quicker than gold to as low as below $19 an ounce.
In June alone, silver has plunged 13 per cent to about $18.80 an ounce currently and 35 per cent for the year compared to a fall of less than 12 per cent for gold.
Analysts said no forecaster predicted such a scenario for silver and most of them seen prices hitting $50 this year.
Silver in particular was hit by concerns that Fed might reduce economic stimulus in the US which has seen traders pour money back into the US dollar in anticipation of less cheap cash and higher interest rates, while taking money out of commodities including silver and gold.
If US economy keeps improving, the printing of money slows and the dollar strengthens, then the safety of silver and gold is less attractive.
Silver futures for September delivery on Globex platform of Comex was seen trading down by 0.99% at $19.328 per troy ounce as of 05.45 PM IST on Wednesday.