Silver prices rise on weak US dollar, ETF inflows; money managers cut net long position



Silver prices traded in the green on Monday afternoon session, tracking firm gold prices and dollar weakness. The white metal ended last week with a modest loss on the MCX.

The semi-precious metal has been trading higher than 20, 50, 100 and 200 days’ moving averages but lower than the 5-day moving average on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 56.24, which indicates upbeat movement in the price.

According to CFTC data, hedge funds and money managers cut their net long positions in COMEX silver by 1,862 contracts to 50,981 contracts.

Silver holdings in iShares ETF rose by 57.7 tonnes to 17,878.85 tonnes. The fund NAV is trading at a discount of 1.04 percent.

The US dollar index traded lower at 89.87, down 0.15 against rival currencies; whereas US 10-year Treasury yields fell to 1.61 percent.

The spot gold/silver ratio currently stands at 67.96 to 1 indicating that silver has outperformed gold.

MCX Bulldesk jumped 75 points or 0.50 percent, at 15,205 at 15:51. The index tracks the real-time performance of MCX Gold and MCX Silver futures.

Sriram Iyer, Senior Research at Reliance Securities said, “International silver prices are trading with small gains on Monday early afternoon trade in Asia, tracking gold prices. Technically, LBMA Spot silver could trade in a range of $ 27.16 to $ 28.15, and a breakout could suggest a direction.”

Technically, MCX Silver July is sustaining above Rs 71,000 levels which can take prices up to Rs 72,100-73,000 levels whereas support is at Rs 70,500-69,900 levels”, Iyer added.

Also read: Silver price ends flat for the week at Rs 71,049 per kg on ETF inflows, dollar weakness; analysts say buy-on-dips

In the futures market, silver for July delivery touched an intraday high of Rs 71,744 and a low of Rs 71,200 per kg on the MCX. So far in the current series, the precious metal has touched a low of Rs 63,456 and a high of Rs 74,222.

Silver delivery for the July contract climbed Rs 590, or 0.83 percent to Rs 71,639 per kg at 15:54 hours with a business turnover of 10,973 lots. The same for the September contract soared Rs 532, or 0.74 percent, to Rs 72,743 per kg with a turnover of 365 lots.

The value of July and September’s contracts traded so far is Rs 1,092.83 crore and Rs 37.91 crore, respectively.

Similarly, the Silver Mini contract for June surged by Rs 581, or 0.82 percent at Rs 71,660 on a business turnover of 14,559 lots.

Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited said, “Silver continue to sustain above the support of 15-SMA of hourly chart placed at Rs 71,394. Spot silver may anticipate momentum towards the resistance of $ 28-28.40 by evening session.”

At 1029 (GMT), the precious metal was up 1.15 percent quoting at $ 27.80 an ounce in New York.

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