Silver (XAG/USD) Climbs to $29.58 Amid Mixed Economic Data and Fed’s Cautious Stance
Silver (XAG/USD) has sustained its bullish momentum, trading around $29.7145 and reaching an intraday high of $29.7365.
Silver (XAG/USD) has sustained its bullish momentum, trading around $29.7145 and reaching an intraday high of $29.7365. This positive movement is driven by several factors, including heightened demand for precious metals like silver as safe-haven assets amidst global uncertainties.
Investors often turn to silver during times of economic or geopolitical instability, supporting its price.
Impact of Economic Data and Fed Stance on Silver Prices
The previously released softer-than-expected US inflation data for April has fueled hopes for potential rate cuts by the Federal Reserve, boosting silver prices. However, recent comments from Fed officials indicate a cautious approach, suggesting that they may not be in a hurry to cut interest rates.
Atlanta Fed President Raphael Bostic noted signs of cooling inflation but emphasized the need for more data.
Similarly, Cleveland Fed President Loretta Mester believes current policy is appropriate, while Richmond Fed President Tom Barkin stresses the importance of maintaining high borrowing costs for an extended period.
Financial markets are now predicting a 75% chance of a Fed rate cut in September, with full cuts expected by year-end.
On the economic data front, US weekly Initial Jobless Claims rose to 222,000 for the week ending May 11, surpassing the 220,000 estimate provided by the US Bureau of Labor Statistics (BLS).
Additionally, Housing Starts increased by 5.7% month-over-month in April, reaching 1.36 million, while Building Permits declined by 3% to 1.44 million in the same month.
The mixed economic data and the Fed’s cautious stance add uncertainty, potentially supporting silver prices as investors seek safe-haven assets amid concerns over the pace of economic recovery.
Speeches from Fed Officials Influence Silver Prices
Investors are also focusing on speeches by Federal Reserve officials, including Neel Kashkari, Christopher Waller, and Mary Daly, for potential insights into the future direction of the Fed’s monetary policy.
These speeches are critical as traders look for clues that could influence the market sentiment and the trajectory of silver prices.
Silver (XAG/USD) Price Forecast
Currently, Silver is trading at $29.58, up 0.21% for the day. On the 4-hour chart, the pivot point at $29.47 serves as a critical support level. Immediate resistance is at $30.14, followed by $30.59 and $31.12.
On the downside, immediate support is at $29.08, with further support at $28.51 and $27.92.Technical indicators show the 50-day Exponential Moving Average (EMA) at $28.54 and the 200-day EMA at $27.35, indicating a bullish trend.
The upward trendline suggests continued buying interest above the pivot point. In conclusion, Silver remains bullish above $29.47. A break below this level could trigger a sharp selling trend.
Investors should closely watch upcoming economic data and Fed communications for further guidance on the price direction of Silver (XAG/USD).
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