Silver yesterday settled at 41050 flat after a late rally erased initial losses and bullion ended the week nearly 3 percent higher as wariness over the U. S. Federal Reserve's message at next week's monetary policy meeting pushed the dollar down. Bullion's third consecutive weekly rise marked its longest weekly winning streak since March, prior to the two-day $225 selloff in mid April. On Friday, sharp losses in industrial metals across the board more than offset the dollar's fall to a five-week low, which was driven by speculation the FOMC will emphasize next week its intention to keep interest rates low for longer. Bullion has gained more than 9 percent in three weeks after the Federal Reserve in late June assured financial markets it would only start phasing out its monetary stimulus when it was sure the U. S. economy was strong enough to stand on its own. Bullion has lost a fifth of its value this year as investors feared recovery in the United States might prompt the Fed to scale back its $85 billion monthly bond purchases. Outflows from gold exchange-traded funds (ETFs) have also weighed. Investors now digest news that JPMorgan Chase & Co said it was considering a sale or a spin-off of its physical commodities business, including its holdings of commodities assets and its physical trading operations, as regulators increase scrutiny of Wall Street's role in commodities. Technically market is under short covering as market has witnessed drop in open interest by -3.7% to settled at 12095 while prices up 287 rupee, now Silver is getting support at 40901 and below same could see a test of 40753 level, And resistance is now likely to be seen at 41218, a move above could see prices testing 41387.

Trading Ideas:

Silver trading range for the day is 40753-41387.

Silver gained on short covering after prices dropped as worries about any shifts in U. S. monetary policy prompted to lock in gains.

The dollar slipped after a Wall Street Journal report suggested the central bank will not be raising rates any time soon.

The Thomson Reuters/University of Michigan consumer sentiment rose more than expected in July, hitting 85.1from 83.9 in June.