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4 min read | Updated on December 19, 2024, 17:26 IST
SUMMARY
Silver prices remained under pressure for the third day in a row and slipped below the crucial support and swing low of ₹89,200. If it surrenders the crucial support on closing basis, then it may extend weakness up to ₹85,000.
Commodity trade setup 19 Dec: Silver breaks crucial support of ₹89,000, Crude oil protects 21 EMA
Gold: From the technical standpoint, gold prices are currently trading below both the short-term daily exponential moving averages (EMA) like 21 and 50. This indicates that the short-term trend of the yellow metal remains weak. However, it is trading within the range of ₹79,000 and ₹73,000 for the past three months and unless it breaks this range on a closing basis, the trend may remains sideways.
For the upcoming sessions, traders can monitor the swing low of ₹89,200. If silver surrenders this level on a closing basis, then it may extend the weakness up to ₹85,000. On the flip side, if it protects this zone then the trend may remain sideways with resistance around ₹96,200.
A pole and flag pattern is a continuation pattern seen in technical analysis. The sharp price movement (pole) is followed by a consolidation phase (flag), often leading to a breakout in the direction of the initial trend. However, it is important to note that the crude prices are consolidating within the range of ₹6,100 and ₹5,600. Unless it breaks this range on a closing basis, the trend may remain sideways.
The open interest data for the 15 January expiry has significant call and put placement at 6100 strike, indicating range-bound movement for the crude oil around this level. However, traders should closely monitor the price action. A break above or the key levels of ₹6,100 and ₹5,800 may provide directional clues.
Derivatives trading must be done only by traders who fully understand the risks associated with them and strictly apply risk mechanisms like stop-losses. The information is only for the client's consumption, and such material should not be redistributed. We do not recommend any particular stock, securities, or strategies for trading. The securities quoted are exemplary and are not recommendatory. The stock names mentioned in this article are purely to show how to do analysis. Take your own decision before investing.
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