Silver above Rs 93,000: Is it an investment opportunity or a fleeting trend?

On Thursday, silver prices on the MCX hovered at Rs 93,400 per 10 grams, hitting an intraday low of Rs 93,325. In the international market, prices maintained a similar trend, hovering around $30.99 per ounce. The silver price paused its downside momentum at the beginning of July and turned positive last week, increasing by nearly 7.30%. The MCX Silver September contract closed at 92,969 in the previous session.

Aamir Makda, Currency and Commodity Analyst at Choice Broking, said, “Comex silver spot found support over $28.57 towards the end of June and took a pullback last week when the price increased by ~7% and started trading over $31. The key support level on the daily chart would be the 20-EMA level placed at $30.09, and the immediate hurdle would be at $31.49.”

On the daily chart, the silver price followed the uptrend line after the breakout over the resistance of the falling wedge formation. It continues to trade above all key averages, i.e., the 50, 100, and 200-DMA levels placed at 88,585, 84,786, and 80,163, respectively. Crucial resistances for the silver price would be at 94,186 – 95,210. Breach of these hurdles will accelerate the upward trend in the silver price.

The Dollar Index has stayed frail in recent sessions, trailing below the 50-DMA level placed at 104.73. In addition, the gold/silver ratio has continued to be sluggish below the 20-DMA level, which is 78, which is collectively positive for the silver price. RSI levels remained downward, trailing above 60 on all key timeframes. There was a bullish crossover on MACD above the zero line, and positive histograms emerged on the daily chart, which suggests bullish biases in silver.

Makda says, “Given the positive trend in silver prices, we anticipate a further surge in the upcoming sessions. Traders are advised to consider long opportunities for the target levels of 95,900 – 97,000. The upcoming US inflation data may play a crucial role in determining the future price action in silver.”

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