Is There a Surge in Silver Prices Forecasted Due to Soft CPI Data Leading to Multi-Year Highs?

Welcome to Extreme Investor Network, where we provide you with unique insights and analysis on the stock market, trading, and Wall Street. Today, we will be focusing on the weekly movement of Silver (XAG/USD) and what it means for investors.

Technical Analysis:
Looking at the chart, we can see that silver has experienced a strong upward movement, reaching $31.22 and marking a 7.14% weekly gain. The recent rally broke above key resistance levels at $29.80 and $30.55, with the next significant resistance level at the 11-year high of $32.52. Potential support levels to watch include $28.57 and $27.22, which could act as pullback points if the rally loses momentum.

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Investor Sentiment and Predictions:
Investor sentiment is currently leaning towards a rate cut, with futures markets indicating a 72% chance of a 25 basis point cut in September. Analysts at Jefferies suggest that a softer CPI reading could support the case for a rate cut, especially if inflation data remains subdued. This aligns with the expectation that the high inflation readings from Q1 were anomalies.

Fed’s Position and Future Moves:
Fed Chairman Jerome Powell has highlighted the improvements in the labor market but emphasized the importance of further progress on inflation before considering easing monetary policy. With Powell’s upcoming testimony and the July Fed meeting, there is speculation that a rate cut could be signaled for September. Treasury yields have already reacted to the news, with both the 10-year and 2-year yields dropping significantly.

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Market Forecast:
Based on current economic indicators and technical analysis, the short-term outlook for silver appears bullish. If the Federal Reserve does signal a September rate cut, silver prices could aim for the 11-year high of $32.52. Investors will be closely monitoring next week’s inflation data for further insights into the Fed’s monetary policy direction.

Stay tuned to Extreme Investor Network for more in-depth analysis and valuable insights into the ever-changing world of investing and trading. Trust us to provide you with the information you need to make informed decisions and stay ahead of the curve.

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