Commodity Trading Tips for Silver by KediaCommodity

Ajay Kumar Kedia 22 May 2013

Silver Silver dropped as investors snapped up safe-haven dollar positions ahead of Federal Reserve Chairman Ben Bernanke's testimony. Bullion has been pressured in recent weeks by fears the Federal Reserve could scale back or halt its monthly $85 billion bond purchases that have buoyed bullion's appeal as a hedge against inflation. The precious metal, down in seven of the last eight sessions, has been hit since the start of the year as investors shift into higher-yielding equities on signs that economic growth is picking up, especially in the United States. Silver traders remained cautious ahead of Bernanke’s testimony and the minutes of the Fed’s most recent policy meeting, both due Wednesday. Markets were awaiting any indication that the U.S. central bank will begin to scale back its asset purchase program this year after recent economic data bolstered optimism over the economic recovery. BoJ may front-load bond purchases or offer funds via market operations more frequently if bond market turbulence persists, hoping it can prevent a renewed spike in yields by fine-tuning market operations. Speculation that the U.S. central bank will trim its bond purchases, or quantitative easing, sooner than expected has mounted, given signs of an improvement in the U.S. labor market. Charles Evans said the central bank could continue its bond buying through the summer, but end it in the autumn if it became confident about the U.S. jobs outlook. Now technically market is trading in the range as RSI for 18days is currently indicating 31.6, where as 50DMA is at 47599.82 and silver is trading below the same and getting support at 42511 and below could see a test of 41851 level, And resistance is now likely to be seen at 43739, a move above could see prices testing 44307.