A bullish AB=CD pattern is visible on silver mcx daily chart. Currently we are trading in leg ‘CD’ of this pattern. Leg ‘BC’ was a counter move that has retraced leg ‘AB’ by 78.6%. In such patterns leg ‘CD’ is always equal to leg ‘AB’ or 127% extension of leg ‘BC’. Silver is now moving downwards to complete final leg ‘CD’ of this pattern that completes at 37593 zones. As per this pattern instrument reverses after completion of leg ‘CD’. Thus we expect a recovery in Silver from the areas of 37600-37500. Stochastic has been staying in oversold territory during the formation of leg ‘CD’ and now leg ‘CD’ is about to complete and oversold reading on stochastic would also prevent bears to enter aggressively and it would help this metal to recover from expected support zones to offload oversold reading.
Recommendation: Buying silver on declines around 37600-37500 with stop loss of 37200 for targeting 38400-39000-39400 and more upside might be appropriate in short term.
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