Silver extended its robust rally, increasing by 0.41% to Rs 182,352, as prices remained close to record highs, with the metal now appreciating nearly 100% year-to-date. The increase is attributed to constricted global supply, robust investment demand, and anticipations of more significant rate reductions by the US Federal Reserve. Silver-backed ETFs have accumulated almost 200 tons, elevating total holdings to their peak since 2022, as an unprecedented volume of silver entered London last month to alleviate significant market tightness.
This transition has resulted in a depletion of inventories across alternative hubs, as evidenced by the stocks on the Shanghai Futures Exchange declining to their lowest point in ten years. In October, Chinese exports reached a historic high of 660 tons, intensifying domestic shortages, while volumes on the Shanghai Gold Exchange fell to their lowest levels in nine years. Despite substantial inflows into London, concerns regarding liquidity remain, as evidenced by persistently high borrowing costs.
London vault holdings increased by 6.8% to 26,255 tons, with a valuation of $41.3 billion; however, the market continues to exhibit sensitivity to supply disruptions. In the interim, more than 1,568 tons have been withdrawn from Comex warehouses since the beginning of October; however, total US inventories continue to be elevated year-over-year, attributed to uncertainties surrounding tariffs.
From a technical perspective, silver is currently experiencing a new buying phase, as evidenced by a 0.34% increase in open interest to 13,783, which confirms a resurgence in long positions. Immediate support is identified at Rs 180,645, while a more significant downside is anticipated at Rs 178,940. Resistance is established at Rs 184,400, and a breach above this threshold could propel prices toward Rs 186,450, thereby maintaining the bullish momentum.