- Summary:
- Silver price returned to the $30s territory after more than a month below it. We tell you why the market looks aligned for further upside.
Silver price hit the $30 per ounce mark for the second time in as many days, having edged up +0.5 percent in early trading on Tuesday. Also, the greyish metal extended its winning streak to the third session in a row, within a longer uptrend that goes back to early August. Silver price has renewed propulsion from the geopolitical tension in the Middle East, following a spate of heavy fighting between Israel and Hezbollah in the last week.
XAGUSD is also driven by the impending Federal Reserve interest rate cuts starting September, which has driven up safe haven demand for non-yielding precious metals. Silver price has gained 2 percent in the last five sessions and is up 7.9 percent in the last month. That has built a strong bullish undercurrent that could sustain further gains.
A return to the $30s territory is significant, as it creates the psychological foundation to sustain the recent gains. With the sustained gains over the last twenty days, the pressure to take profit is diminished, as opposed to short-lived volatile spikes.
Momentum indicators
The 4-hour silver price chart suggests a continuation of the upward momentum, with the price above the Volume Weighted Moving Average (VWMA). Meanwhile, the RSI is at 60, affirming bullish control.
Silver price support and resistance levels
Silver price will likely retain upward momentum as long as it stays above the 29.93 pivot level. That could provide propulsion to encounter the first barrier at 30.08. However, that mark could be overcome on further bullish control, with the resulting momentum potentially sending the price to test 30.20.
Alternatively, a move below 29.93 will signal a takeover by the sellers, with the initial support likely to be at 29.80. However, if they extend their control, the selling pressure could breach that support and invalidate the upside narrative. Also, that could result in further declines to test 29.68.
