Silver Continues Downward Trend
For the second consecutive day, Silver (XAG/USD) is trading with a negative bias, signaling a potential decline in value. Despite holding above the $31.00 mark during the Asian session, the white metal remains near a three-week low reached last Wednesday, indicating a downward trajectory in its price.
Technical Analysis
- The 50-day Simple Moving Average (SMA) confirms a bearish outlook for Silver.
- Oscillators on the daily chart show negative momentum, supporting a potential decline in XAG/USD.
- Breaking below $31.00 could lead to a test of the 100-day SMA around $30.35.
Should Silver fall below $31.00, it may continue to slide towards the $30.00 psychological mark and potentially reach the $29.50-$29.45 support level. Further downward movement could see Silver testing the crucial 200-day SMA near $28.70-$28.65.
Potential Upside
- Above $32.00, Silver faces resistance, with $32.35-$32.40 as a key supply zone.
- Breaking through could push XAG/USD towards $33.00 and beyond.
Positive momentum above $32.00 may trigger a short-covering rally, propelling Silver towards higher price levels.
Silver FAQs
What is Silver?
Silver is a precious metal used for investment purposes due to its intrinsic value and historical significance as a medium of exchange. Investors can buy physical Silver or trade it through Exchange Traded Funds to diversify their portfolios or hedge against inflation.
Factors Affecting Silver Prices
Silver prices can fluctuate based on geopolitical events, interest rates, US Dollar performance, investment demand, supply levels, and industrial usage. Changes in demand from major economies like the US, China, and India can also impact Silver prices.
Relationship with Gold
Silver often follows Gold’s price movements as both metals are considered safe-haven assets. The Gold/Silver ratio can help investors assess the relative valuation of the two metals and make strategic investment decisions based on this ratio.