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Silver
Shining Silver
CMP: ` 46403 (As on 01st Jul, 2016) trend while Silver could not even get closer to all time high.
But 2016 seems to have begun a change in the pattern of waves
Buy: ` 45800-45500 during primary trend. With the recovery in US, prospects of a
strong growth in India amid deterioration of brand China and
Target Price: ` 52000-56000 recent event like ‘Brexit’, the ‘safe haven’ status of Gold can
further be hit, providing an opportunity to Silver to lead from
Stop-Loss: < ` 41600 the front not only as a precious metal but also as an industrial
metal having sound and tangible demand-supply logistics.
After remaining in downtrend for most part of Getting back on the technical side, the fifth impulsive wave of
the year 2013, 2014 and 2015, Silver has shown a the current primary bearish trend is still not over. Prices have
consistent recovery this year. The white metal has taken a halt here and the recent crucial trend line breakout on
also outperformed its elder sibling, Gold, in first half monthly chart of Silver suggests an extension of the corrective
of the current year. Gold rose around 24% this year waves (upward) in 2016. The current rally can shape up into
till June whereas Silver added more than 35% gains an ABC structure within the impulsive 5th wave and can
in the same period, clearly getting an edge over the take prices to $26, the point where overlapping will start and
former. break the bearish impulsion. All in all, the probabilities for a
conversion of the relief rally into a mid-term bullish rally are
Technically, both Gold and Silver were in a primary very high.
bearish trend since 2011. In last four years Gold has
seen strong relief rallies in between various stages We recommend buying Silver September contract at Rs 45800-
of bearish waves but the frequency of these rallies 45500 for targets in the range of Rs 52000-56000. Maintain stop
have remained very low as far as Silver is concerned. loss below Rs 41600.
Either the spells have remained shorter or the
magnitude of the rally had been compromised, 7 ARIHANT CAPITAL ¡ JULY 2016
thus keeping the white metal on back foot in India
as well, where a weak INR against USD led Gold
score a huge premium in this era of primary bearish
