Silver looks relatively stronger than gold. Though the MCX-Silver futures contract tumbled initially last month, it has managed to recover sharply from its low of ₹39,808 per kg. Technically, the contract has failed to get fresh selling pressure below the 200-week moving average support at ₹40,708 and has bounced back sharply after a brief decline below it. This leaves the outlook bullish for the contract. A rise to ₹43,145, the 200-day moving average resistance, is possible in the near term. A strong break above this hurdle can take the contract further higher to ₹44,000 or ₹44,400 thereafter. If the contract fails to break above ₹44,000 and reverses lower, a pull-back move to ₹43,000 and ₹42,500 is possible. But such a pull-back move looks less probable as global silver prices look strong. The global spot silver, which is currently at $18.2 per ounce, has an immediate resistance at $18.5 per ounce. A strong break and a weekly close above this hurdle will confirm an inverted head and shoulder reversal pattern. Such a break may clear the way for a fresh rally to $20 and $20.5 over the medium term.

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