From a technical perspective, silver is now consolidating in the middle of the $72.5–$86 range. Prices have been moving within this channel for about three weeks, since late January. However, a recent rebound from the lower limit seems to be changing the landscape, as the precious metal shows growing determination to climb toward the upper line.
Momentum indicators confirm bullish sentiment. The Relative Strength Index (RSI) has recently jumped from neutral to positive territory, crossing the 50 threshold. With the overbought zone still out of reach, the indicator suggests that buyers remain in control and there is ample room for further upside before any corrective risk emerges.
The Moving Average Convergence/Divergence (MACD) has also crossed above the zero line, reinforcing the presence of an uptrend.
If these technical signals hold, silver prices could surge to the channel’s upper limit in the coming weeks. That said, this scenario may be lost on the rocks of the market’s key uncertainty factor—the core Personal Consumption Expenditures (PCE) index. The inflation report is due today, February 20, with a consensus forecast pointing to a 0.3% month-on-month increase.
If the actual data come in below expectations, markets could perceive it as a sign of subdued inflationary pressure and a potential thaw in the US Federal Reserve’s (Fed) monetary policy rhetoric. Such an outcome may provide additional support for silver, amplifying the bullish momentum building from the technical setup.
The ultimate recommendation is to buy silver at current levels, as it could reach $86 per ounce in one or two weeks. Place Stop loss 1% below the purchase price.
This content is for informational purposes only and is not intended to be investing advice.
