Silver Price Prediction – Silver Prices Maintained Their Rally On A Weaker Dollar And Falling Yields

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key ideas

  • Silver prices rose on weaker economic data.
  • Treasury yields fall amid continued equity selling last week.
  • Oil prices rose slightly due to tight global supply.

Silver prices traded higher as inflation fears persist among investors. Gold prices extended their gains on Tuesday as the US dollar fell to a one-month low. The dollar continued to weaken from multi-year highs.

The aggressive Fed tightening has already been priced into the market. Benchmark yields fell today as last week’s stock selling resumed. The ten-year yield fell 12 basis points today and traded above a level not seen since the end of 2018. Oil prices rose on concerns over limited supply .

The European Union is in the process of concluding an agreement on the banning of Russian oil imports. An embargo will likely offset stronger demand due to easing restrictions in China and increased oil production in the United States.

The US Manufacturing Flash PMI for May came in at 57.5, while the Dow Jones estimate was at 57.4. However, the US Flash PMI for services came in at 53.5, 1.5 below the forecast of 55.

These key economic data points indicate that rising inflation has weighed on the supply and lowered demand for goods and services. Fed Chairman Powell is due to speak today and will likely declare the Fed’s objective of raising rates to keep inflation under control despite the evident weakness in the economy.

Technical analysis

Silver prices remain elevated, holding above the $22 level, maintaining a bullish outlook. XAG/USD maintains bullish momentum against the 200-day moving average. A weakening dollar and disappointing economic data support the precious metal’s positive momentum.

Support is near the 10-day moving average of $21.56. Resistance is seen near the 200-day moving average of 23.58. The short-term momentum is positive as the Fast Stochastic had a crossover buy signal.

The medium-term momentum turns positive when the histogram prints positively with the MACD (Moving Average Convergence Divergence). The trajectory of the MACD The histogram is in positive territory, reflecting an upward trend in price movement.


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