Yahoo News Silver Price Daily Forecast – The Current Upside Trend Remains Intact
Silver Video 08.04.20
Silver Holds Above $15.00 As Markets Believe That Virus Containment Measures Are Working
Silver continues its upside move after it breached the 20 EMA level several days ago. Equity markets remain optimistic which also helps precious metals in the current market environment.
The U.S. Dollar Index has corrected to the 100 level but does not experience additional downside despite the positive dynamics in riskier assets. Meanwhile, gold continues its attempts to get above the $1700 level, but so far these attempts have been futile.
I maintain my conviction that the whole precious metal segment will get a boost if gold manages to settle above $1700 as such a move will lead to an influx of additional money into the whole sector.
At this point, it is unclear which additional catalysts are necessary for precious metal upside.
On the one hand, another leg down in equity market will lead to increased safe haven buying. However, it remains to be seen whether precious metals will serve as safe haven assets in this scenario.
During the early stage of the current crisis, only the U.S. dollar and the U.S. Treasuries were seen as bullet-proof safe haven assets, while other asset classes often experienced downside on negative economic or healthcare news.
On the other hand, U.S. dollar weakness could be of great help for silver and other precious metals. Such a scenario demands continued improvements in investor confidence, which could come from stabilization on the virus front or from new economic stimulus.
Technical Analysis
Silver stays above the 20 EMA and continues its upside trend. The nearest resistance is located at the 50 EMA level at $15.70. Silver has already made an attempt to get there, but this attempt was stopped at $15.50.
This was a very fast move, so silver had little chance to get above $15.70 without first settling below the resistance level. If the 50 EMA level is breached to the upside, silver will be able to get to pre-crisis levels at $16.50 and complete the rebound.
The nearest support for silver is at the 20 EMA level at $14.70. In case silver prices fall below this support level, silver will find itself back in the $13.80 – $14.70 range, although I’d expect some additional support in the $14.30 – $14.60 area.
This article was originally posted on FX Empire
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