The silver prices which started correcting from the high of 48930 extended its fall till the low of 38325 in December 2016. From those levels it has been slowly recovering for last few weeks and headed till 42580 levels.
On the technical front, prices have exactly retraced 61.8% of the previous rally ranging from the low of (32460 - 45506) and currently, prices are recovering from the same. On the daily chart silver prices have come out of the downward slanting trend channel and it has formed at Inverted Head and Shoulder pattern. According to the inverted head and shoulder pattern the neckline resistance was at 42100 mark. This week prices moved above the neckline resistance of 42100 has confirmed the bullish break out and the upside targets of the pattern are projected till 44800 then 46000 levels. In addition to above analysis the momentum indicator MACD has made fresh positive cross over on the weekly chart and the RSI is also recovering from the lower supports supporting the positive momentum.Therefore, we recommend buying in silver around 42100-42200 for upside target of 46000/47500 levels.
MCX Silver Weekly chart
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