Silver prices are recovering from last week's losses, gaining almost 2%. Market participants continue to follow the confrontation regarding the debt ceiling.
On Sunday, the White House and Republican representatives came close to a consensus on pausing the debt ceiling for a year and a half.
According to Treasury Secretary Janet Yellen, the United States will probably have enough reserves to delay a potential national debt default until June 5. Later, the Treasury will not have sufficient resources to meet its obligations.
The announced date (June 5) provided a kind of pause for the U.S. government in negotiations on the debt ceiling.
There is uncertainty about the future level of interest rates by the Federal Reserve System (Fed). Regulator representative Christopher Waller said that a decision on rates next month will depend on data that will be published in the next three weeks. At the same time, Neel Kashkari, president of the Minneapolis Fed, forecasts a rate hike above 6% to bring inflation down to the 2% target. James Bullard, president of the St. Louis Fed, also pointed to the need for the interest rate increase by half a percent this year.
The U.S. trade balance deficit in goods increased to $96.8 billion in April 2023 from an upwardly revised $84.6 billion. This exceeded market expectations of 85.7 billion in preliminary estimates. April personal consumption expenditures in the States were the highest in three months. This strengthens forecasts that the Federal Reserve System will maintain tight monetary policy for a long period of time.
Silver price reached support at 22.73 in the end of the last week.
The Relative Strength Index indicator (standard values) shows a divergence on the H1 timeframe, which gives a warning signal for a trend reversal. In addition, the price of silver is forming a rising impulse. The current trend has already overcame the top of the last downtrend impulse, which also indicates a change in direction. If the price forms the second wave in the near future, the probable support will be at the level of 23.05.
The short-term prospects for silver are to buy near the 23.05 level.
The target is at the level of 23.75.
Part of the profit should be fixed near the level of 23.35.
The stop-loss is at the level of 22.65.
Bullish trend has a short-term character, so the volume of trade should not exceed 2% of your balance.