Image Source: Pixabay
 

Silver On the Move

Silver prices are on the move again today following yesterday’s breakout. The metal has been a firm favorite over recent weeks, with silver futures now up around 28% from the YTD lows. The rally has seen price breaking out above the former YTD highs to print fresh highs on the year with price currently holding above the $25 mark for the first time since Q2 2022.
 

Weaker USD Supporting

The main catalyst for the upside move this week was yesterday’s inflation data and subsequent fall in USD. While core inflation was seen rising slightly in the prior month (5.6% from 5.5%), traders seem to be focusing more on the 1% fall in headline inflation. With headline CPI dropping back down to 5% from 6% the prior month, traders are scaling back their Fed tightening expectations further which is helping lead the USD lower, creating room for silver to breakout higher near-term.
 

Bullish Outlook

With market pricing for the May FOMC currently split 65-35% in favor of a .25% hike, there is plenty of room for silver to continue higher near-term. Any further dovish Fed commentary or data weakness in the run-up to the May meeting is likely to see that pricing swinging in favor of an unchanged decision which should keep pressure on USD and metals firmly supported.
 

Technical Views

Silver

(Click on image to enlarge)

The breakout above the 24.0073 level and the bear channel top have seen the market exploding higher. Price is now fast approaching a test of the next big technical resistance at the 26.0974 level. With momentum studies bullish, the focus is on a further break higher and a test of the 26.9194 level above. 

More By This Author: