Silver yesterday settled up 1.26% at 41663 as prices recovered from the day's low after Rupee fell below the key psychological level of 60 to the dollar to a three-week low on Tuesday, posting its biggest fall in a month, as the central bank kept interest rates on hold and failed to announce any additional steps to defend the currency. While Silver on COMEX was inched lower in quiet trading as participants largely stayed on the sidelines ahead of a Fed policy statement that may provide clues on the pace at which it plans to scale back its bond-buying program. Bullion pared earlier losses on signs the U. S. economy may be slowing as data showed home prices in May rose less than expected and consumer confidence waned in July. The Fed is scheduled to release a policy statement Wednesday afternoon after its two-day meeting. Traders will be looking for clues as to when the U. S. central bank will start tapering its $85 billion monthly bond purchases. Bullion plunged after the Fed's June meeting when it gave its most explicit signal yet that it plans to wind down the era of easy money. However, Fed chief Ben Bernanke's subsequent remarks about the need to keep a stimulative policy in place given low inflation and an uncertain market triggered a gold rally. Fed officials are likely to have a lively debate on how best to prepare financial markets for a reduction of their bond-buying program but appear certain to wait for further economic data before curtailing their stimulus. Technically market is getting support at 40922 and below same could see a test of 40182 level, And resistance is now likely to be seen at 42131, a move above could see prices testing 42600.

Trading Ideas:

Silver trading range for the day is 40182-42600.

Silver seen supportive amid growing uncertainty over the future of the central bank's monetary stimulus program.

Markets watching for clues on when the U. S. central bank will start to taper or reduce its $85 billion monthly bond purchases.

Investors are also waiting for second quarter U. S. growth data due and the influential U. S. jobs report for July on Friday.