MCX Silver under short covering; Resistance seen at 62876
Commodity Online | July 23 2020
UPDATED 09:40:19 IST

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Technically Silver market is under short covering as market has witnessed drop in open interest by -20.41% to settled at 13232 while prices up 3773 rupees.

Now MCX Silver is getting support at 58676 and below same could see a test of 56238 levels, and resistance is now likely to be seen at 62876, a move above could see prices testing 64638.

Silver yesterday settled up by 6.58% at 61115 amid bets for more stimulus and in the wake of worsening U.S.-China relations. Prices gained because of its duality as not only a valuable investment but also as an industrial metal.

U.S. Senate Majority Leader Mitch McConnell said that the GOP supported another round of stimulus checks in its coronavirus relief bill. However, he floated a $40,000 income cutoff in a bid to lower the cost of another spending package.

Republicans hope to keep new spending at roughly $1 trillion, while Democrats are eyeing a package worth up to $3.5 trillion. Prices are also moving up amid heightened risk aversion as U.S.-China relations showed signs of further deterioration.

While viewed as a haven from market turmoil -- just like pricier sister gold -- silver also has wide industrial uses in products like solar panels and electronics.

That means the metal’s drawing both investors worried about rising virus cases and those focused on rosier indicators, from optimism over China’s recovery and promising vaccine news, to the landmark stimulus package clinched by Europe’s leaders.

The United States has asked Beijing to close its diplomatic consulate in Houston within the next 72 hours, the Chinese foreign ministry said, dealing another blow to the rapidly deteriorating relations between the two countries.

Trading Ideas:
--Silver trading range for the day is 56238-64638.
--Silver prices rallied amid bets for more stimulus and in the wake of worsening U.S.-China relations.
--Prices gained because of its duality as not only a valuable investment but also as an industrial metal.
--U.S. Senate Majority Leader Mitch McConnell said that the GOP supported another round of stimulus checks in its coronavirus relief bill.

Courtesy: Kedia Commodities