Silver fell as optimism over Fed cutting interest rates this year faded

Source: | Kedia Advisory | Commodities News 2023-05-11 03:46

Silver yesterday settled down by -0.99% at 76688 as optimism over the Federal Reserve cutting interest rates this year faded after the U.S. inflation report, triggering profit-taking among some investors. The headline inflation rate in the US unexpectedly declined to a 3-year low of 4.9% in April strengthening bets that the Federal Reserve may be over with the tightening cycle. The annual core consumer price inflation rate in the United States, which excludes volatile items such as food and energy, ticked down to 5.5% in April 2023, as expected, from 5.6% in the prior month, amid a downtick in the cost of rent.

On the other hand, the inflation rate in the UK was at 10.1% last month, staying above 10% for the 7th consecutive month and remaining close to the 40-year high of 11.1% reported in October. As a result, UK policymakers are widely expected to raise interest rates by 25 basis points to 4.5% on Thursday and the market forecasts rates to rise further to around 4.8% later this year. New York Fed President John Williams said inflation remains too high and the central bank will raise rates again if necessary, adding he doesn’t expect inflation to return to the Fed’s 2 per cent goal until the next two years.

Technically market is under long liquidation as the market has witnessed a drop in open interest by -7.99% to settle at 18563 while prices are down -768 rupees, now Silver is getting support at 75928 and below same could see a test of 75168 levels, and resistance is now likely to be seen at 77784, a move above could see prices testing 78880.

Outlook 2023: Will strong demand outlook lead to a rally in silver?

Source: The Economic Times | Markets | By Pawan Nahar

Synopsis: Silver, other than being a precious metal, has more usage in the industrial sectors and thus, industrial demand also guides its movement. Furthermore, gold also holds influence over silver prices.

Silver witnessed a roller-coaster ride in 2022, thanks to increased volatility in the bullion market and industrial metals but managed to deliver around 15% returns to investors. The metal faced bouts of profit taking but geopolitical tensions kept its demand intact.

Silver, other than being a precious metal, has more usage in the industrial sectors and thus, industrial demand also guides its movement. Furthermore, gold also holds influence over silver prices.

Rahul Kalantri, VP-Commodities, Mehta Equities, said, “In the mid of 2022, we saw see a significant fall in silver prices because of the low industrial demand due to a global slowdown and a drastic jump in dollar index as well as bond yields.”

Silver has its own return characteristics and is an attractive commodity in the present market conditions.

NS Ramaswamy, Head of Commodities, Ventura Securities said, “The gold-silver ra ..

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Silver Price Analysis: XAG/USD bears can ignore latest bounce to 100-day SMA

  • Silver struggles to keep week-start gap-up but snaps three-day losing streak.
  • Bearish MACD, downbeat RSI joins sustained break of yearly support line, now resistance, to favor silver sellers.
  • Yearly low, 200-day SMA will be a tough nut to crack for bears.

Silver prices waver around $25.40, fading the initial run-up to $25.56, during Monday’s Asian session. In doing so, the white metal confronts 100-day SMA while also keeping the last week’s break of an ascending trend line from March 2020.

Given the bearish MACD and descending RSI line join the previous week’s downside break of the key support line and 100-day SMA, silver prices are likely to remain depressed.

However, fresh selling can wait until the bears conquer January 27 low near $24.70 as it triggered the commodity’s bounce during Friday.

Also acting as the strong downside barrier is a confluence of 200-day SMA and the yearly low near $24.20.

Meanwhile, a daily closing beyond the 100-day SMA level of $25.45 will need to cross the previous support line, at $25.80 now, to recall the silver buyers.

Following that, lows marked during late February around $26.20 should test the bulls targeting the monthly top beyond $27.00.


Silver Price Analysis: XAG/USD set to refresh yearly low, $25.00 tests the bears

Silver prices remain heavy near late January lows, currently down 0.23% around $25.30, during Friday’s Asian session. The white metal dropped the fresh bottom in multiple days after breaking an ascending trend line from November 30 the previous day.

The bearish bias also gains support from the metal’s failure to recover from recent lows while staying below 100-day SMA amid bearish MACD.

Hence, silver sellers are en route 200-day SMA level of $24.15. Though, 61.8% Fibonacci retracement of November 2020 to February 2021 upside, at $25.00, offers immediate support to the quote.


Silver falls to fresh five-week low as precious metals stay pressured

Silver down over 1% to the lows of $25.63 on the day

he drag in gold is also inadvertently having a negative pull on the likes of silver and platinum lately and we are seeing more of that today as well with silver having fallen to its lowest levels since 28 January below $26.
The drop pushes silver towards a test of key trendline support @ $25.65 and also brings into focus the 100-day moving average (red line) @ $25.43.
Those will be key lines in the sand for silver buyers to hang on to in order to keep the upside momentum running, after having seen year-to-date gains erased this week after having jumped to $30 at the start of February.
The dollar’s resilience so far today is also part of the story but precious metals haven’t really been getting much love – especially gold – as of late.
Silver ETFs may not have declined as drastically as gold but they have eased off since peaking in early February amid the surge in demand and retail trading frenzy at the time.