Silver slips below Rs 2.28 lakh amid global precious metals sell-off

Silver prices plunged more than Rs 7,000 on the MCX on Monday, falling below Rs 2.28 lakh per kg amid a global sell-off in precious metals. Rising crude prices, inflation concerns, higher US yields and a stronger dollar weighed on sentiment

Mumbai: Silver prices witnessed a sharp decline on the Multi Commodity Exchange (MCX) on Monday, with the white metal plunging more than Rs 7,000 and falling below the crucial Rs 2.28 lakh-per-kg mark amid a broad-based sell-off in precious metals.

The steep fall came as rising crude oil prices heightened inflation concerns globally, strengthening market expectations that the US Federal Reserve may keep interest rates higher for longer or consider further policy tightening.

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Higher interest rates and elevated US Treasury yields typically reduce the appeal of precious metals, which do not offer interest income, while a stronger dollar makes commodities priced in the US currency more expensive for overseas buyers.

During noon trade, the December silver futures contract on MCX was trading at Rs 2,27,494 per kg, down Rs 7,202, or 3.07 per cent, from its previous close of Rs 2,34,696 per kg.

Commenting on the technical outlook, market experts said the immediate resistance was at Rs 2,32,000–Rs 2,33,000, followed by Rs 2,36,000–Rs 2,37,000.

“Immediate support is at Rs 2,27,000–Rs 2,28,000, followed by Rs 2,23,000–Rs 2,24,000,” analysts stated.

“The RSI at 41.12, below its signal line, indicates fading momentum,” analysts added.

COMEX silver opened at $64.66 and was trading near $62.40, down 3.72 per cent on the day. It slipped below the $63.50–$64.00 zone, which previously acted as support and is now likely to act as resistance, and was testing the $61.50–$62.00 support region.

“Silver remains weaker than gold in today’s session. Immediate resistance is at $63.50–$64.00, followed by $65.50–$66.00. Immediate support is at $61.50–$62.00, followed by $59.50–$60.00,” market watchers stated.

“The price remains below the 20-, 50-, 100- and 200-day EMAs, while the RSI continues to edge lower,” experts noted.

Meanwhile, USD/INR opened at 95.80, up 0.13 per cent on the day, and was trading just below the 96 mark. Immediate resistance was at 96.00–96.10, followed by 96.40–96.50.

“Immediate support is at 95.70–95.80, followed by 95.40–95.50. The pair remains above its key short-term moving averages. The RSI at 59.51, above its signal line, reflects a mild bullish, or rupee-weakening, bias,” market watchers mentioned.