Silver price at a two week low, will it recover or not?

Silver price at a two week low, will it recover or not?

The Silver price fell slightly late on Tuesday. Prices were able to recover from two-week lows, supported by a weaker-than-expected S&P Global Purchasing Managers Index (PMI) report. However, prices struggled to stabilize due to greenback weakness, while US Treasury yields fell from the short end of the yield curve.

Silver Price fell sharply, close to 3.50%, as concerns about geopolitical tensions in the Central region have eased in the East, weakening safe-haven demand for precious metals.

In addition, the recent strengthening of the dollar has added to recent selling pressure, while the expected long-term increase in US interest rates has added price pressure to precious metals.

Decreasing safe-haven demand has also made prices more vulnerable to higher US interest rates in the long term, especially as the Federal Reserve has issued unusual signals and steady inflation numbers over the past two weeks.

Meanwhile, comments from several central bank officials on long-term interest rate policy limits and strong US economic data also weighed on the metal. High interest rates reduce the attractiveness of unproductive silver.

Last week, Israel launched a missile attack on Iran, but the latter has scaled back, allaying fears of a region-wide war and reducing demand for safe-haven assets.

For more cues about the Fed’s rates trajectory, markets will now shift their focus towards US GDP figures and on PCE price index data- the Fed’s preferred inflation gauge- for more cues on rates.

Technical Outlook – Silver Price

Silver price recovered from lows 79361 at 80678, up 0.12% compared to Monday close of 80579.00

Yesterday’s price action caused the formation of a hammer candlestick, suggesting a reversal from here.  Further, prices traded above the short term moving average.

However, there is currently no attractive buyer in sight. To maintain control, they need to push prices above the psychological 81,180 level, which could extend the rally to the 82,000-82,650 level.

It is strong that the important support level is at 78,500, a price break may touch the next support. 77800-76900. General trends remain volatile ahead of crucial numbers. Hence, trade cautiously.

Happy Trading!

Commodity Samachar
Learn and Trade with Ease

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