Markets continue to follow the news about the U.S. government debt ceiling. Against this background, the uncertain state of market participants is represented on the gold and silver price charts.
On Thursday, the dollar rebounded on Treasury yields after a survey of long-term inflation expectations of U.S. consumers rose to its highest level since 2011. That fact allowed the Fed to raise an interest rate next month.
According to ING, the inability to agree on the change of the U.S. government debt ceiling may continue to support the dollar.
U.S. President Joe Biden was optimistic about negotiations concerning the increase of the national debt ceiling with representatives of the Republican Party. The country is threatened by a default, whose consequences, according to the Biden administration, might be large-scale and catastrophic for the economy.
Republicans are required to reduce the budget expenditures in response to an increase in the U.S. debt ceiling. The White House disagrees with these terms, and negotiations are delayed. The next meeting of the parties will take place this week.
At the same time, if a bipartisan agreement is reached, the U.S. currency could become vulnerable again.
Support for the dollar might remain if there are no positive developments.
A stronger U.S. currency could limit gains in precious metals, but medium-term expectations are still positive.
Strategists at ANZ Bank assess the outlook for silver again.
Institutional investors are expected to return this year as the fundamental backdrop is still strong, and several macroeconomic issues remain unresolved.
According to ANZ bank officials, demand for the white metal is likely to level off. However, supply may decrease by 140 million ounces, thus accounting for 12% of consumption.
Silver prices are projected to rise to $26 by the end of 2023.
The silver price broke out of the M30 timeframe downtrend, forming the first downward wave behind it. The RSI indicator curve (standard values) shows a divergence, which might herald the rollback in the form of a second ascending wave. The target of the rollback may be in the area of the broken support at a level of 24.60.
Long-term prospects for silver are buying.
Target is at the level of 24.60.
Part of the profit should be fixed around the level of 24.25.
Stop-loss is around the level of 23.70.
The bullish trend is long-term, so choose a trading volume of no more than 2% of your balance.