Silver Price Forecast: Fed Signals, Jobs Data, and $52 Breakout Setup Ahead
Silver's trying to stage a measured recovery this week as investors wait with bated breath for a batch of US economic releases that could...
Quick overview
- Silver is attempting a recovery as investors await key US economic data that could impact interest-rate expectations.
- Gold's recent stability has positively influenced silver, which is reacting strongly to market uncertainties and safe-haven demand.
- Silver is currently testing a resistance level at $51.92, with potential targets of $53.23 and $54.42 if it breaks through.
- The outlook remains constructive for silver as long as it stays above $50.44, but failure to hold this level could lead to a decline.
Silver’s trying to stage a measured recovery this week as investors wait with bated breath for a batch of US economic releases that could totally flip interest-rate expectations on their head. Coming up today are the Federal Reserve’s minutes of their last meeting & then, on Thursday, we’ve got the Nonfarm Payrolls report – that’s the week’s big two drivers. Gold is already bouncing back amid a shifting landscape, and investors are flocking to safe assets amid a slight uptick in unemployment claims and uncertainty over the Fed’s next move.
Last month’s 25-basis-point rate cut didn’t give metals a clear direction because Fed chief Jerome Powell didn’t offer any indication of whether he would ease further. The uncertainty has left gold & silver propped up, partly because investors tend to turn to non-interest-bearing assets as rate cuts gain traction. Markets are now giving a 49% chance of another rate cut at the Fed in December, which means silver’s going to be super sensitive to every bit of data hinting at a softer job market.
Silver is Following Gold’s Safe-Haven Bid
Generally, Silver follows gold’s lead on the big picture, but when investors start to get a bit spooked, it reacts much more strongly. With gold stabilising near long-term support levels after last week’s sell-off, silver has bounced strongly from the $50.44 demand zone. The investors are going defensive – our Fed uncertainty and tighter credit conditions are making them think twice about investing in anything risky – and this is all helping to keep silver’s prices steady in the short term.
[[XAG/USD-graph]]
And then you’ve also got the fact that commodities in general are looking pretty good at the moment, with industrial demand in the 4th quarter still strong despite some mixed manufacturing numbers from major economies.
Technical Outlook: Bulls are Eyeing a Break Above $51.92
On the two-hour chart, silver is now reclaiming its trendline from early November – that’s a line that has consistently brought in buyers when it’s been touched. The price is now bumping up against the $51.92 resistance level – and that’s being helped along by a steady move above the 20-EMA. The RSI is at 58, which still looks good for momentum without getting too overexcited.
If silver can break through the $51.92 level with a strong-looking candle – something like a bullish engulfing pattern – the next targets are $53.23 & $54.42. But if it gets rejected at that level, then it’s likely to pull back towards $50.78 or $50.44, where that trendline & the demand zone meet.
Silver Price Forecast
As long as silver holds above $50.44, it looks pretty constructive. A break above $51.92 opens the door to $53.23, and if things keep going, then it could even reach $54.42. But if it fails to hold its trendline support, it’s exposed to $49.06.
Investors who are watching gold’s reaction to Fed signals might find silver offers a more exciting short-term opportunity – especially if we see rate-cut expectations firm up.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Save