- La Plata is consolidated for the second day within 36.00 –36.60 $ despite the positive feeling of the market.
- The RSI suggests a bullish continuation, but no new maximums have been recorded since the June 18 peak in 37.31 $.
- A break below $ 36.00 risks a setback to $ 35.00 and the 50 -day SMA in 34.24 $.
The price of silver recorded solid profits on Wednesday, rising 1.40%, however, it continues to consolidate within the range of 36.00 -36.60 $ for the second consecutive day. A positive market atmosphere and the general strength of the US dollar limited the progress of gray metal.
XAG/USD price forecast: Technical Perspectives
From a technical point of view, the XAG/USD continues to have a bullish bias, although it has failed to print a new higher maximum since June 18, when the silver reached an annual peak of 37.31 $. At the same time, the last minimum of the cycle reached on June 23 at $ 35.82, is still respected. This, together with the bulls accumulating impulse as indicated by the Relative Force Index (RSI), suggests that a higher upward movement is expected.
That said, the first level of resistance for the XAG/USD is 37.00 $. If it is exceeded, the next stop would be the annual peak of $ 37.31, before trying the peak of February 29, 2012 at 37.49 $. A rupture of this last will exhibit 38.00 $
On the other hand, silver could take a negative turn if the price in cash falls below $ 36.00, raiding the way for a 3,82 $ test. Once surpassed, the next stop would be $ 35.00, before challenging the simple mobile average (SMA) of 50 days in 34.24 $.
Graphic Diary of the XAG/USD
SILVER – FREQUENT QUESTIONS
Silver is a highly negotiated precious metal among investors. Historically, it has been used as a value shelter and an exchange means. Although it is less popular than gold, operators can resort to silver to diversify their investment portfolio, for their intrinsic value or as a possible coverage during periods of high inflation. Investors can buy physical silver, in coins or bullion, or negotiate it through vehicles such as the funds quoted in the stock market, which follow their price in international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can cause the price of silver to shoot due to its safe refuge status, although to a lesser extent than that of gold. As an asset without performance, silver tends to climb with lower interest rates. Its movements also depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (XAG/USD). A strong dollar tends to maintain the price of silver at bay, while a weaker dollar probably drives rising prices. Other factors such as investment demand, mining – silver supply is much more abundant than gold – and recycling rates can also affect prices.
Silver is widely used in the industry, particularly in sectors such as electronics or solar energy, since it has one of the highest electrical conductivities of all metals, surpassing copper and gold. An increase in demand can increase prices, while a decrease tends to reduce them. The dynamics in US economies, China and India can also contribute to price fluctuations: for the US and particularly China, its large industrial sectors use silver in several processes; In India, the demand for consumers for precious metal for jewelry also plays a key role in pricing.
Silver prices tend to follow gold movements. When gold prices go up, silver typically follows the same path, since their status as shelter is similar. The gold/silver ratio, which shows the number of ounces of silver necessary to match the value of an ounce of gold, can help determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that silver is undervalued, or that gold is overvalued. On the contrary, a low ratio could suggest that gold is undervalued in relation to silver.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
