Technically Silver market is under short covering as market has witnessed drop in open interest by 0.43% to settled at 13175 while prices up 75 rupees.
Now MCX Silver is getting support at 60294 and below same could see a test of 59397 levels, and resistance is now likely to be seen at 62244, a move above could see prices testing 63297.
Silver yesterday settled up by 0.12% at 61190 powered by low interest rates, resurgent investment demand, disrupted production and a recovery in industrial consumption.
Lower returns on bonds have made it more attractive to hold gold and silver, and investors are stockpiling both in the hope they will hold their value as central bank stimulus unleashed during the pandemic erodes other assets.
Consumption of silver in industries, such as solar panels and electronics, is also likely to increase as the economy rebounds, while silver mine output is to fall 7% this year as the novel coronavirus interrupts operations.
The European Union's $860 billion recovery package may have lent a helping hand to the commodity's boost as leaders announced long-term "green and digital investments" for the reconstruction of the bloc.
Market sentiment was also lifted by positive news from data on a COVID-19 vaccine by candidates including AstraZeneca, Moderna, and Pfizer this week. A slew of business and consumer confidence data is expected to hit across Europe and should display a generally improving trend as the Eurozone rebounds from lockdowns.
Meanwhile, tensions between the U.S. and China have come to the fore again after the U.S. asked Beijing to close its diplomatic consulate in Houston within the next 72 hours and Chinese foreign ministry spokesperson Wang Wenbin condemned the action and warned of retaliation if the U.S. does not reverse its decision.
--Silver trading range for the day is 59397-63297.
--Silver prices rose powered by low interest rates, resurgent investment demand, disrupted production and a recovery in industrial consumption.
--Consumption of silver in industries, such as solar panels and electronics, is also likely to increase as the economy rebounds.
--Prices also got boost as silver mine output is to fall 7% this year as the novel coronavirus interrupts operations.
Courtesy: Kedia Commodities