- Summary:
- Silver prices crossed the $30 per ounce mark for the first time in more than two weeks, and there's little pressure on the commodity.
Silver Price extended its winning streak to the fifth consecutive day, underlining the attractiveness of safe haven metals as the market awaits Fed interest rate decision making. XAUUSD was up 0.7 percent at the time of writing, returning to the $30 per ounce mark for the first time since August 28. Silver’s cousin, gold spiked to new all-time highs of $2,573 per ounce.
The rush to safe haven assets is driven by a blend of impending interest rate cuts and concerns over the stability of leading global economies. The CME FedWatch Tool reports that the probability of a 50 basis points cut is 41 percent today, up from 28 percent a day earlier, following Thursday’s higher-than-expected Initial Jobless Claims figures.
Initial Jobless Claims came in at 230,000, exceeding the forecast figure of 237,000 for the week ending September 5. That has added pressure on the dollar and raised the prospects of a deeper rate cut next week. Meanwhile, yields on benchmark 10-year US treasury bonds declined to 3.63 percent, bringing more propulsion to non-yielding silver prices.
On the downside, however, silver price upside will be limited by concerns over China’s economy. The world’s second-largest economy has been printing out mixed data, pointing to reduced demand by silver’s industrial users. However, stable growth in the renewable energy sector could provide some reprieve. China will release economic data on Saturday, and that could shape silver price trajectory.
Silver price chart
Silver price looks set for more gains, with the buyers in control above the pivot point at $29.95. The upward momentum will likely encounter the first resistance at 30.19, but a stronger bullish push could break above that mark to test 30.50.
Alternatively, a move below 29.95 will shift the balance to favour the sellers. In that case, the momentum will likely find initial support at 29.70. However, a buildup of the downward pressure could break that support, and at that point the upside narrative will be invalid. Furthermore, the decline could extend to test the second support at 29.50.
