The decline in US Treasury bond yields and expectations of a Fed rate cut have reinforced the strength of silver prices.
Key Points
- Today, silver reached $30.415, continuing its rise from an opening of $30.155.
- Geopolitical tensions in Gaza continue to drive safe-haven demand for silver amid escalating conflicts.
- Today’s US Initial Jobless Claims data could impact silver prices, with the market also focused on Friday’s NFP report.
Silver Daily Price Analysis – 06/06/2024
On Wednesday, silver (XAG/USD) closed at $30.075, up from an opening price of $29.625, marking a 1.54% increase. This rise was driven by a weaker US dollar, influenced by growing expectations of a Federal Reserve rate cut. Soft US economic data, including lower-than-expected private sector employment growth and softer Personal Consumption Expenditures (PCE) Price Index data, bolstered the anticipation of monetary easing, subsequently supporting silver prices. Additionally, ongoing geopolitical tensions in the Middle East heightened the safe-haven demand for silver.
As of the current trading day, silver opened at $30.155 and has reached $30.415, reflecting a 1.14% gain. The continuation of the upward trend is sustained by the same economic factors as the previous day. The market’s focus is now on the upcoming US Initial Jobless Claims data, which could provide further insights into the labor market’s health and influence the Federal Reserve’s policy decisions.
The decline in US Treasury bond yields has played a crucial role in the recent strength of silver. The ISM Services PMI showed growth, but the Prices Paid sub-component indicated easing inflationary pressures, reinforcing the likelihood of a rate cut by the Federal Reserve. The geopolitical situation in Gaza remains significant, with escalating conflicts increasing safe-haven demand for silver.
Key Economic Data and News to Be Released Today
Today’s key economic data include the US Initial Jobless Claims. If the figures come in weaker than expected, it could further depress the US dollar and push silver prices higher. Conversely, stronger-than-expected data might provide some support to the dollar, potentially capping gains in silver. The market is also eyeing the NFP report due on Friday, which is a crucial indicator of economic health and will likely influence the Federal Reserve’s next steps.
Silver Technical Analysis – 06/06/2024
Today, silver confirmed a bullish reversal that started yesterday by crossing above the 200 EMA. This indicates that we can anticipate the price continuing to climb higher in the short term.
However, with the RSI below level 50, we might expect a further price dip to a nearer support zone that coincides with the oversold level before the price fully continues its bullish momentum.
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