Silver's move above the rectangle opens new growth targets

05 April 2023 170
Silver's move above the rectangle opens new growth targets

Weak economic data in the U.S. provided a strong driver for silver. The Labor Department reported a drop in job openings in February, which fell to its lowest level in two years. The current situation shows that employers' need for employees decreased. 

 

On Friday, a report on the U.S. labor market will be published. According to a number of analysts, this data is unlikely to ease concerns about the economy situation, although it cannot be excluded. Nevertheless, Commerzbank expects a further slowdown in employment growth. The decrease in job openings is most likely a hint that U.S. employment numbers will show a cooling down. Then it will be possible to talk in general about a reversal of the labor market in the United States. Such a scenario would be positive for precious metals.

 

Analysts continue to bet on gold and silver.

According to the head of commodity strategy at Saxo Bank, Ole Hansen, silver, which has been in deficit for several weeks, has a lot of space to grow.

At the same time, Kevin Grady, president of Phoenix Futures and Options, notes the continued trend of central banks to buy gold. He said that this will lead to an increase in the number of investors in the yellow metal market.

Grady added that central banks buy gold for the long term and do not sell it after prices fall. This creates a significant force in the market, attracting investors. In addition, the ongoing banking crisis will contribute to the growth in demand for precious metals as safe assets. 

 

On the technical analysis, silver overcame a strong resistance in the rectangle. This rectangle has been relevant for several months. Now there was a breakdown of its upper boundary, which opens up new targets for the growth of the metal. First of all, the level of the previous local maximum becomes relevant.

Thus, the growth target for silver is $26.14. Stop-loss can be set at a decrease of the metal inside the rectangle, which corresponds to the level of $24.30.

 

Rise in the price for silver:

Take profit – 26.14

Stop-loss – 24.30

This content is for informational purposes only and is not intended to be investing advice.

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