Key Takeaways:
- Silver price climbs to $28.21, surpassing the key $28.00 level after US JOLTS data suggests potential rate cuts.
- Momentum remains flat despite a positive RSI, with significant resistance at the 100-DMA of $29.14.
- Sellers would need to breach below $28.00 to test support levels at $27.71 and the 200-DMA at $26.59.
Silver Price Recovery Amid Weaker Labor Market Data
Silver price recovered in late trading on Wednesday, gaining over 0.74% and reaching $28.21. The recent US JOLTS report indicated a cooling labor market, increasing the likelihood of a 50-basis point interest rate cut at the upcoming Fed meeting. As a result, Silver saw an uptick in value, while US yields decreased, weakening the US Dollar and enabling the precious metal to retake the $28.00 mark.
XAG/USD Technical Outlook
The XAG/USD pair continues to hover around the $28.00 level, with a daily close above it. Though the RSI is bullish, momentum remains flat, indicating a lack of clear buyer or seller dominance. Key technical indicators, such as the 50 and 100-day moving averages, suggest a potential decline in Silver prices. To move lower, sellers must break support levels at $28.00, followed by $27.71 and then a possible decline towards $26.59 represented by the 200-DMA.
About Silver
Silver is a widely traded precious metal that investors often use for portfolio diversification, as a hedge during inflation, or for its intrinsic value. Prices can be influenced by factors such as geopolitical instability, economic recessions, interest rates, US Dollar performance, investment demand, mining supply, and industrial usage. The metal is heavily utilized in various industries due to its high electrical conductivity.
Relationship with Gold
Silver prices tend to follow Gold’s movements, as both are considered safe-haven assets. The Gold/Silver ratio can be used to determine the relative value between the two metals, with a high ratio suggesting Silver is undervalued compared to Gold, and vice versa.