Expectations of monetary policy easing by Fed support rise in silver prices

11 March 2024 75
Expectations of monetary policy easing by Fed support rise in silver prices

Silver prices stabilized near the highest level since early December at 24.62 on Monday. Last week the cost of the white metal increased significantly, growing by 5.11%. The upward movement was driven by market expectations of a change in the US Federal Reserve’s (Fed) strategy for interest rates.

In his recent speech to Congress, Fed Chairman Jerome Powell hinted at the possibility of monetary policy easing later this year if economic statistics are favorable.

The number of jobs in the US non-farm sector increased by 275,000 last month, exceeding economists’ expectations of 200,000. The data for January were revised downward to 229,000 jobs instead of 353,000 reported earlier.

The unemployment level in February rose to 3.9% from 3.7% recorded in the previous three months.

Last week's 1.10% decline in the dollar index and 2.51% decline in 10-year Treasury bond yields have made silver more attractive to international investors, minimizing the cost of holding it.

This week, market participants are expecting new data on the Consumer Price Index and the Producer Price Index in the US. If they exceed expectations, forecasts for a rate cut in June could be revised to a later date, potentially putting pressure on precious metals markets.

Silver prices are in a broad narrowing correction on the D1 timeframe.

In terms of wave analysis, the price is forming the third ascending wave on the H4 timeframe.

The Stochastic Oscillator indicator (standard values) is between overbought and oversold states. This indicates that the formation of an uptrend is not yet complete.



The short-term outlook for silver suggests buying

The target is at the level of 25.750.

Part of the profit should be taken near the level of 25.000.

A Stop-loss could be set at the level of 23.400.


The bullish trend is short-term, so trade volume should not exceed 2% of your balance.

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

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