Silver yesterday settled up 0.22% at 41438 rose as a drop in the dollar prompted investors to buy, sending bullion back to the key technical resistance level near 41850. The metal benefits as the dollar fell against the euro after a German Ifo survey showing business morale improved there. Data also showed new US claims for jobless benefits edged higher last week, but remained within a range that suggests the labour market's recovery is on track. However, an improving US economic outlook could weigh on bullion prices. On Wednesday, data showed new US home sales in June vaulted to a five-year high, while the US manufacturing sector and euro zone private industry also improved in July. While the world's largest silver-backed exchange-traded fund iShares Silver Trust posted its biggest one-day jump in holdings since January as a rebound in silver prices triggered resurgent buying from longer-term retail investors, analysts said on Thursday. The move stands in sharp contrast to a month ago when the silver ETF's tonnage tumbled to a 2013 low, sparking fears that mom-and-pop investors were beginning to lose faith in the metal. After falling toward technical support at $18 twice and holding there each time, silver's price has gained 11 percent in the past 30 days. Year to date, silver is still down 33 percent, underperforming gold which is down 21 percent. Technically market is under fresh buying as market has witnessed gain in open interest by 0.31% to settled at 11104 while prices up 92 rupee, now Silver is getting support at 40886 and below same could see a test of 40333 level, And resistance is now likely to be seen at 41767, a move above could see prices testing 42095.

Trading Ideas:

Silver trading range for the day is 40333-42095.

Silver rose after official data in U.S. revealed that more individuals sought out jobless assistance last week than expected.

The metal showed good gains earlier this week after assurances from the Fed that any changes to its QE policy would depend on economic data.

The lack of clear direction reflected indecision among traders awaiting fresh indications on U.S. Fed policy, due next week.