Silver futures traded on the Multi Commodity Exchange (MCX) are gaining bullish momentum. The fall from the high of ₹38,136 a kg recorded on January 6 halted at a low of ₹36,530 on Friday. The contract has gained from this low and is currently trading near ₹37,850. The reversal from the low of ₹36,530 indicate bullish signals for the contract which has potential to extend the ongoing rally in the coming days.

On the global front, the spot silver ($16.95/ounce) has breached and risen above its resistance at $16.5 as expected. The commodity is testing a key immediate resistance at $17. A break above this level can take the price further higher to the next targets of $17.5 and then to $18. The level of $16.5 could now serve as a good support for the contract.

Silver futures also have an immediate resistance at ₹38,000. But the price action on the chart suggest that the contract can breach this hurdle. Such a break can take it to the next targets of ₹38,600 and ₹39,000 in the coming week.

Traders with a short-term perspective can go long at current levels. Stop-loss can be placed at ₹37,100 for the target of ₹38,800.

The 55-day moving average level at ₹36,490 is the key short-term support for the contract. The bullish outlook will get negated only on a strong break below this level. Such a fall can drag the contract lower to ₹35,850 .

Note: The recommendations are based on technical analysis. There is a risk of loss in trading.

Related Topics
comment COMMENT NOW