Silver prices experienced a significant decline on Thursday due to increased selling pressure before the annual rebalancing of global commodity indexes and the release of crucial US economic data. On the Multi Commodity Exchange (MCX), silver fell by nearly 3.5%, trading below Rs 2,42,000 per kilogram during the session. This drop was anticipated as passive investment funds were expected to adjust their holdings in precious metals futures to align with new index weightings.
The selling pressure intensified, with the decline in silver prices being more pronounced than usual following the strong performance of gold and silver in recent months. Throughout the trading session, silver fluctuated between an intra-day low of Rs 2,48,163 and a high of Rs 2,51,889, compared to the previous close of Rs 2,50,605. In the preceding trading session, MCX silver had already experienced a sharp decline, dropping by as much as Rs 11,700 per kilogram to touch a low of Rs 2,47,100.
Market experts provided insights, mentioning that in INR, gold had support levels at Rs 1,36,550-1,35,310 with resistance at Rs 1,39,350-1,40,670. Similarly, silver was noted to have support at Rs 2,46,810, 2,42,170 and resistance at Rs 2,55,810, 2,58,470. The key accumulation zone for silver was identified as Rs 2,45,000–Rs 2,48,000, emphasizing its role as a high-beta outperformer within the precious metals complex.
In the international markets, COMEX silver displayed a modest recovery, with prices slightly increasing to $77.780 per ounce after erasing early gains. Despite a brief rise to an intra-day high of $78.875 per ounce, gaining around 1.5% post Wednesday’s selloff, market watchers emphasized the importance of a breakout above $4,500 for further positive movement. Market participants are exercising caution due to the expected volatility in silver prices in the near term, driven by index rebalancing-related flows and upcoming US economic data.
