Silver (XAG) Daily Forecast: $29.40 Pivot Key for Silver’s Next Move

Geopolitical Tensions and Silver

Geopolitical tensions and political uncertainty in Europe further complicate the outlook for silver. These factors tend to boost the appeal of safe-haven assets like precious metals, potentially mitigating some of the downward pressure from the stronger dollar.

Fed Members Hawkish Stance

Within the Fed itself, there is a lack of consensus on the future path of interest rates. While some officials, like Cleveland Fed President Loretta Mester, are open to rate cuts if inflation continues its downward trajectory, others, including Chicago Fed President Austan Goolsbee and Minneapolis Fed President Neel Kashkari, prefer a more cautious approach.

This divergence in views introduces an additional layer of uncertainty, which could limit the dollar’s appreciation and create a price floor for silver.

Overall, the silver market is grappling with a tug-of-war between the Fed’s hawkish signaling and the reality of easing inflationary pressures. While the stronger dollar poses a challenge for silver, the potential for rate cuts and the ongoing geopolitical tensions could provide support.

Silver prices jumped on Monday, trading at $29.55, up 2.03%. However, the technical outlook remains cautious as the price sits just above the pivot point of $29.39. A sustained move above this level could signal further bullish momentum, targeting $29.81, $30.24, and $30.76.

Conversely, a failure to hold above $29.39 could trigger a pullback towards immediate support at $29.03, followed by $28.67 and $28.00. The 50-day EMA at $29.40 is just below the price, while the 200-day EMA at $29.88 could act as resistance if silver retraces.

Traders should closely monitor price action around $29.39 for directional clues.