Silver futures dip 0.81% to Rs 62,535 per kg, further downside likely

Silver prices declined to Rs 62,535 per kg on November 11 as participants increased their short positions, as seen by the open interest. The precious metal had gained 3.2 percent the previous day on the COMEX index.

Silver prices retreated as gold struggled for direction and the US dollar strengthened. The US dollar index traded firm at 92.87 levels, up 0.15 percent.

Silver holdings in iShares ETF dropped by 112.8 tonnes to 17,799.1 tonnes.

MCX iCOMDEX Bullion Index was down 42.27 points, or 0.27 percent, at 15,524.70 at 3:53 pm. The index tracks the real-time performance of MCX Gold and MCX Silver futures.

Sriram Iyer, senior research analyst at Reliance Securities said, "LBMA Silver Spot is trading on a flat note where it is holding a support of 100-Daily Moving Average (DMA) near $24.00 levels below which will continue downside pressure up to $23.80-$23.30 levels whereas resistance is at $24.48-$24.80 levels."

In the futures market, silver for December delivery touched an intraday high of Rs 63,044 and a low of Rs 62,097 per kg on the MCX index. So far in the current series, the precious metal has touched a low of Rs 49,415 and a high of Rs 79,723.

Silver delivery for December contract fell Rs 509, or 0.81 percent to Rs 62,535 per kg at 3:56 pm with a business turnover of 13,248 lots. The same for the March contract slipped Rs 429, or 0.66 percent, to Rs 64,270 per kg with a turnover of 2,393 lots.

The value of December and March’s contracts traded so far is Rs 1,534.70 crore and Rs 32.24 crore, respectively.

The spot gold/silver ratio currently stands at 77.35 to 1, indicating that silver has outperformed gold.

Iyer said that the MCX Silver December is trading below the 50-DMA, where above Rs 63,300 levels could see further upside movement. Prices could take support near Rs 61,300-60,200 levels and resistance is at Rs 63,300-63,900 levels. He advised selling Silver December in a range of Rs 63,200-63,250 with a stoploss of Rs 63,800 for a target of Rs 62,400.

At 10:31 am GMT, the precious metal was down 0.55 percent quoting at $24.32 an ounce in New York.