Silver prices lost momentum on Monday. A stronger dollar, driven by hawkish comments from the Federal Reserve System (Fed) and rumors of a possible postponement of monetary easing plans, contributed to the decline in the precious metal. However, ongoing geopolitical tensions in the Middle East may support the white metal at current levels.
In the near future, traders' attention will be focused on the release of key economic indicators from the United States, including Consumer Price Index (CPI), Producer Price Index (PPI) and Retail Sales data. These indicators could provide new information about the state of the economy and the direction of inflation.
Last week, some Fed officials outlined their hawkish stance. Raphael Bostic, president of the Atlanta Fed, said that the regulator sees no reason to cut rates in 2024 because of the observed rise in inflation in the early months of the year. Neel Kashkari of the Minneapolis Federal Reserve Bank said that he is maintaining a cautious approach for the time being while monitoring the momentum of economic indicators.
Silver is also an industrial metal. With the world's growing interest in renewable energy, the active development of advanced technologies and increasing supply shortages, the market situation is changing. Experts at the Silver Institute estimate the shortage of the metal this year at 215.3 million ounces. This would be the second largest shortage in more than two decades. Meanwhile, total global silver consumption is expected to increase by 2% to 1.219 billion ounces.
On a technical level, silver prices are forming a bullish trend on the D1 timeframe.
In terms of wave analysis, the price is currently forming the third ascending wave on the H3 timeframe. Breaking the top of the first wave at 29.790 will strengthen the bullish movement. The volume of the Bulls Power indicator (standard values) is in the positive zone, confirming the upward trend.
Signal:
Short-term prospects for silver suggest buying.
The target is at the level of 31.000.
Part of the profit should be taken near the level of 29.600.
A stop-loss could be placed at the level of 26.100.
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.
