The silver futures contract traded on the Multi Commodity Exchange (MCX) has reversed sharply higher from its crucial support level of Rs.33,000 a kg. After recording a low of Rs.33,030 on Thursday, the contract has risen sharply higher from there. It is currently trading at Rs.34,285.
Key supports are at Rs.34,000 and Rs.33,850. There is no immediate danger of any strong fall as long as the contract trades above these support levels.
A rise to Rs.35,000 and then to Rs.35,350 looks likely in the coming days. Short-term traders with high-risk appetite can go long.
Stop-loss can be kept at Rs.33,725 for the target of Rs.35,000. Intermediate dips to Rs.34,000 can be used to accumulate long positions.
The outlook will turn negative only if the contract breaks below the crucial support at Rs.33,000 levels. The next target will be Rs.32,600. But such a strong fall looks unlikely at the moment.
On the global front, the spot silver price ($14.28/ounce) has found strong support near $13.6 and has reversed sharply higher from there. Supports are at $14 and $13.75.
A rise to $14.5 or even to $14.8 is possible in the coming days. A rise in the global spot price can aid the MCX-silver futures contract to move higher.