The short-term downtrend in silver futures traded on the Multi Commodity Exchange (MCX) remains intact. The contract has been oscillating in a narrow rangebetween ₹36,700 and ₹37,300 since Friday.

Since the overall trend is down, the contract is more likely to break this range downwards, below ₹36,700 and fall to ₹36,000 and then to ₹35,900 in the coming days. Also significant resistance in the band of ₹37,500-₹37,700 can restrict the upside for the contract.

Short-term traders with high risk appetite can go short. Stop-loss can be kept at ₹37,750 for the target of ₹36,100. Intermediate rallies to ₹37,500 and ₹37,700 can be used to accumulate shorts.

Selling pressure will increase on the contract if it declines below ₹35,900. In such a scenario, the downtrend can extend to test the next support at ₹35,000. But the level of ₹35,900 is a key trendline support level. So, decline below this support might not be easy for the contract as of now. A strong reversal from here will have the potential to take the contract higher to ₹40,000 levels once again. Having said this, the level of ₹35,900 will need a close watch in the coming days which will decide the next leg of move for the contract.

On the global front, the spot silver ($16.15 per ounce) can decline to test its key support at $15.45 in the near-term. Whether the price breaks below this support or not will decide the next leg of move.

A break below $15.45 can drag it to $15. On the other hand, a higher reversal can take the spot price northwards to $16 and $16.5 once again.

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

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