- The price of silver is recovered abruptly to about $ 36.00 after attracting offers around the 20 -day EMA.
- The White House clarified that the US has no plans to attack Iran immediately.
- The Fed warned of upward inflationary risks under Trump’s leadership.
The price of silver (XAG/USD) recovers half of its initial losses and bounces up to about 36.10 $ during the Friday trading session on Friday. The white metal attracted offers after reviewing the minimum of two weeks around $ 35.50 while tensions in the Middle East remain intact in the middle of the air war between Israel and Iran.
Increased geopolitical tensions increase the demand for shelter assets, such as silver.
Earlier on the day, the price of silver faced a strong sale after comments from the White House that indicated that the United States (USA) will not be involved in the Israel-Irel war immediately.
The demand for shelter assets increased abruptly on Thursday after a Bloomberg report showed that senior US officials are preparing for the possibility of an attack on Iran as soon as the weekend.
Meanwhile, the consistent warnings of the Federal Reserve (FED) that the new economic policies imposed by the US president, Donald Trump, after returning to the White House will be inflationary for the economy, have also increased the attractiveness of safe refuge of the silver price.
The silver performs better in an environment of high inflation, but a position of restrictive monetary policy by the Fed foreshadows a bad future for assets that do not generate performance.
On Wednesday, the Fed warned of inflationary risks up to keep the stable interest rates in the range of 4.25%-4.50%. “We have had inflation of goods a little and we hope to see more of that in summer,” said Fed President Jerome Powell, at the press conference after the decision on interest rates.
Technical Analysis of La Plata
The price of silver is recovered abruptly after attracting offers near the 20 -day exponential (EMA) mobile average, which quotes around $ 35.50. The white metal has corrected after reaching a new maximum in more than a decade around $ 37.30 on Wednesday.
The 14 -day relative force (RSI) index descends to about 60.00. A new bullish impulse would arise if the RSI remains above that level.
Looking down, the minimum of October 22 around $ 34,87 will act as a key support zone. On the positive side, the maximum of June 18, $ 37,32 will act as a key obstacle.
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.
