Silver Price Forecast: XAG/USD posts fresh multi-year high at $30.50 on firm Fed rate-cut prospects

Source Fxstreet
May 17, 2024 14:43
  • Silver price prints a fresh multi-year high at $30.50 amid firm speculation for Fed rate cuts.
  • The US Dollar falls back as investors see the Fed reducing interest rates from September.
  • Fed officials want to see more good inflation data to gain confidence that price pressures will return to the 2% target.

Silver price (XAG/USD) refreshes multi-year high at $30.50 in Friday’s New York session. The white metal strengthens on firm speculation that the Federal Reserve (Fed) will start reducing interest rates from the September meeting.

The confidence of investors for the Fed to begin lowering interest rates from September has strengthened as the United States Consumer Price Index (CPI) report for April has indicated that progress in the disinflation process has resumed after stalling in the January-March period. The scenario is favorable for non-yielding assets such as Silver but weighs on bond yields and the US Dollar.

The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, retreats from the intraday high of 104.80.

In spite of an expected decline in the US inflation, Fed officials have maintained a hawkish guidance on interest rates. St. Louis Fed Bank President Loretta Mester said on Thursday inflation will take longer to reach the 2% target than what she previously thought." She emphasized the need to accumulate more data to have a clearer picture of the inflation outlook.

Silver technical analysis

Silver price has posted a fresh multi-year high at $30.55. Earlier, Silver price recovers sharply after discovering buying interest near the horizontal support plotted from 14 April 2023 high around $26.09 on a daily timeframe. The above-mentioned support was earlier a major resistance for the Silver price bulls. The white metal is approaching the multi-year high at $29.80.

The near-term outlook of Silver has improved as it returns above the 20-period Exponential Moving Average (EMA), which trades around $28.10.

The 14-period Relative Strength Index (RSI) shifts into the bullish range of 60.00-80.00, suggesting that a bullish momentum has been triggered.

Silver daily chart

XAG/USD

Overview
Today last price 30.58
Today Daily Change 1.00
Today Daily Change % 3.38
Today daily open 29.58
 
Trends
Daily SMA20 27.64
Daily SMA50 26.71
Daily SMA100 24.82
Daily SMA200 24.04
 
Levels
Previous Daily High 29.85
Previous Daily Low 29.33
Previous Weekly High 28.77
Previous Weekly Low 26.44
Previous Monthly High 29.8
Previous Monthly Low 24.75
Daily Fibonacci 38.2% 29.53
Daily Fibonacci 61.8% 29.65
Daily Pivot Point S1 29.32
Daily Pivot Point S2 29.07
Daily Pivot Point S3 28.81
Daily Pivot Point R1 29.84
Daily Pivot Point R2 30.1
Daily Pivot Point R3 30.35

 

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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