Silver prices paused its recent fall and recovered more than half percent today. The prices found support as the dollar dropped from a near six-month high against its major counterparts.
The dollar index and dollar index futures fell 0.44% at 104.608 in Asian Trade today, after the greenback surged to near six-month highs 105.1570 last week.
Positive inflation data from China also aided broader sentiment, as data released over the weekend showed some improvement in Asia’s largest economy.
China’s consumer price index (CPI) edged up by 0.1 per cent in August from a year earlier, reversing course slightly from a fall of 0.3 per cent in July, according to data published on Saturday by the National Bureau of Statistics. Beijing has set a CPI control target of around 3 per cent growth for 2023.
Looking ahead, The U.S. Consumer Price Index (CPI) data for August this week is expected to give direction.
Technical Outlook
Since 30 August 2023, silver prices have been giving up more than 5%. Prices dropped from the peak 77200 and made a low 71490 last week. Today, prices traded at 71880, up 0.44%.
Formation of inverted hammer on the above chart, is indicating a trend reversal in near future. However, prices would need to break its immediate resistance 72160 in order to test the next resistance 72900-73550.00.
Alternatively, on the downside, crucial support is seen at 71350 and a break below prices may retreat towards 70500-70000 very soon.
Overall trend expects to remain sluggish and prices may hold its crucial support 71350 during the week. Traders may go long for the above projected levels.