- The price of silver seeks temporary support after almost 1% to about 33.00 $ as commercial tensions between the US and China have been renewed.
- Trump accused China of breach of the commercial agreement.
- PCE inflation in the US is cooled in April.
The price of silver (XAG/USD) has dropped almost 1% close to the key level of 33.00 $ during the American negotiation session on Friday. However, white metal struggles to gain ground since renewed commercial tensions between the United States (USA) and China limit the rise in the US dollar (USD).
The US dollar index (DXY), which follows the value of the dollar against six main currencies, struggles to extend its initial recovery movement above the immediate resistance of 99.70.
Historically, global economic tensions improve the demand for safe refuge assets, such as silver. However, he is struggling to find buyers since a higher US dollar makes investment in the price of silver a expensive bet for investors.
During the US session, the US president, Donald Trump, accused Beijing of breach of the commercial agreement in a publication in Truth.Social. “The bad news is that China, perhaps not surprisingly for some, has totally violated its agreement with us,” Trump wrote.
Meanwhile, the US Expenditure Price Index (PCE) of the US for April have exerted some pressure on silver. The underlying inflation of the PCE in the US, an inflation indicator preferred by the Federal Reserve (FED), increased a 2.5% year -on -year, as expected, slower than 2.7% in March. Precious metals have lower performance in a low inflation environment.
Technical Analysis of La Plata
The price of silver moves between $ 31.65 and $ 33.70 for more than a month. The short -term white metal trend is uncertain since it ranges around the exponential (EMA) mobile average of 20 periods, which is negotiated about 32.90 $.
The relative force index (RSI) of 14 periods ranges within the range of 40.00-60.00, indicating a lateral trend.
Looking up, the maximum of March 28, $ 34,60 will act as a key resistance to metal. On the negative side, the minimum of April 11, $ 30.90 will be the key support zone.
GRAPH DIARY OF LA PLATA
FAQS SILVER
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.
