Silver dropped nearly -1% to settled at 62318 with other commodity prices fell and UK and German bonds gained as appetite for growth linked assets weakened amid fears over the outlook for the global economy, while uncertainty over the timing of a Spanish bailout lingered. Silver dropped with base metals as data released earlier showed that China’s services PMI fell to 53.7 vs 56.3 in August, underlining concerns over a deeper than expected slowdown in the world’s second largest economy. Market participants now looked ahead to Friday’s crucial US non-farm payrolls data, after Fed Reserve Chairman pledged to sustain stimulus even after the US economy recovers in a speech earlier in the week. The Fed said last month it will purchase USD40 billion of mortgage-backed securities every month until the labor market improves. Meanwhile, traders continued to focus on developments in Spain after PM Mariano Rajoy on Tuesday ruled out a bailout request before this weekend, despite persistent speculation that Madrid was moving closer to requesting external financial aid. Markets have been anticipating for the past month that the Spanish government would ask for a full-scale sovereign bailout. A bailout would allow the ECB to step in and buy Spanish sovereign debt, which would result in reduced borrowing costs for the debt-strapped nation. Now technically market is getting support at 62089 and below could see a test of 61861 level, And resistance is now likely to be seen at 62709, a move above could see prices testing 63101.

Trading Ideas:

Silver trading range for the day is 61861-63101.

Silver ended lower tracking weakness in base metals and crude oil prices.

Markets have been anticipating for the past month that the Spanish government would ask for a full-scale sovereign bailout.

Investors are now looking ahead to key policy meetings from the European Central Bank and the Bank of England this week.