The combination of technical and fundamental factors points to further growth in silver price

08 April 2024 94
The combination of technical and fundamental factors points to further growth in silver price

Silver price declined moderately on Monday after reaching its highest level since mid-2021. Investors revised their expectations for an aggressive interest rate cut by the Federal Reserve following the release of the U.S. jobs report.

 

In March, U.S. payrolls experienced a significant increase, which was the largest in nearly a year, while the unemployment rate fell to 3.8%. This data allows the Fed to take its time in easing monetary policy.

 

In the coming days, investors will be closely watching the March U.S. inflation report. The figures could provide more clarity on the Fed's future monetary policy. 

 

Nevertheless, precious metal prices are still supported above $27 per ounce after several weeks of positive momentum. This period of gains has coincided with escalating tensions in the Middle East and a heightened sense of economic uncertainty.

 

The silver market is witnessing substantial capital inflows, with investors increasingly drawn to its potential. Parallel to this, gold has also seen a surge in interest, initially driven by robust central bank purchases and subsequently by speculative buyers. This has set a favorable backdrop for silver, which broke through the $26.00 resistance level, eventually reaching $28.08 per ounce today.

 

Silver price is forming a new uptrend on the H4 timeframe.

 

In terms of wave analysis, the price is forming the third ascending wave on the H1 timeframe. The breakthrough of the top of the first wave at 27,330 has already taken place. This could strengthen the bullish movement in the near term. Positive Bulls Power (standard values) indicates an uptrend.

 

Signal:

The short-term outlook for silver is to buy.

The target is at the level of 31,000.

Part of the profit should be fixed near the level of 29,220.

The Stop-loss could be placed near the level of 25,950.

 

The bullish trend is of a short-term nature, so it is suggested to limit the trading volume to no more than 2% of your capital.

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

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