Silver trading strategy: Check Support, Resistance, other key levels here

As long as Silver continues to hold above $30 (Rs 88,000), we look for a target of $35 (Rs 103,000) in the coming months

Silver: Highest closing level YTD as US bonds rally and Dollar Index slumps

 

Performance

 

On February 13, spot silver traded between $32 and $32.43 and closed with a gain of around 0.34 per cent at $32.25—its highest closing level in 2025 so far.

 

Data roundup

 

US PPI data (January) came in hotter than expected as PPI final demand m-o-m came in 0.4 per cent (forecast 0.3 per cent, prior revised higher from 0.2 per cent to 0.5 per cent), while PPI y-o-y at 3.6 per cent beat the estimate of 3.3 per cent (prior revised higher from 3.5 per cent to 3.7 per cent), too. Core PPI m-o-m and y-o-y at 0.3 per cent and 3.6 per cent were hotter than their respective forecasts of 0.2 per cent and 3.1 per cent.

 

US bonds rallied on PPI data as some of the components of the PPI data that go into PCE inflation data were tame.

 

Initial jobless claims fell from 220K to 213K (forecast 216K), whereas continuing claims at 1850K were way lower than the forecast of 1882K.

 

The Fed Chair Powell's testimony 

In his two-day testimony to Senate Banking and House Financial Services, the Fed chair reiterated his FOMC stance that the US economy is doing well, downside risks to the labour market have diminished, and the Central Bank gas made substantial progress toward inflation but there is still more work to do. He added that there is no rush to cut rates. Although he sidestepped the US President's tariff policy, he said that he believes that economies function best without trade barriers on their trading partners.

 

The US President calls for lowering rates

 

The US President, on Wednesday, once again called for cutting rates to support the US economy.

 

Upcoming data

 

Today's major US data on the card include retail sales advance (January) and import and export price indices (January) along with industrial production (January).

 

US Dollar and yields

 

As tariffs will not be implemented soon and plans do not sound as severe as feared, the US Dollar Index slumped, and bonds remained bid. 

The ten-year yields swung between 4.51 per cent and 4.62 per cent and closed with a loss of over 2 per cent at 4.52 per cent. The 2-year yields at 4.31 per cent settled nearly 1 per cent lower. The US Dollar Index has not been able to gain upward traction despite uncomfortably hot US CPI data as traders, following the announcement of the US President Trump seeking an end to the ongoing Russia-Ukraine war, are piling into the Euro. In addition, tame PPI data and alleviated concerns about tariffs also weighed on the US Dollar Index that closed with a loss of nearly 0.90 per cent at 107.06—the lowest since January 26.

 

COMEX Inventory and ETF 

COMEX silver inventory stood at 372.30 MOz as on February 12, the highest level since March 2021.

 

Total known global silver ETF holdings at 700.401MOz are down nearly 16MOz this year.

 

Outlook 

Silver is expected to trade with a positive bias as US Dollar continues to struggle and markets have turned less sensitive to tariff news. The metal needs to conquer $32.65 level (Rs 96,700 – MCX March contract) to extend its rally to $33.45 as the next major target. Support is at $31.60 (Rs 93,500)/$31 (Rs 92,000).

 

As long as the metal continues to hold above $30 (Rs 88,000), we look for a target of $35 (Rs 103,000) in the coming months. 

 

(Disclaimer: Praveen Singh is an associate VP of fundamental currencies and commodities at Mirae Asset Sharekhan. Views expressed are his own.)