Silver Price Daily Forecast – Silver Continues To Rebound After Recent Sell-Off

Silver Video 23.04.20.

Silver Settles Above $15.00

Silver returned back above 20 EMA as the market situation stabilized and rebound in oil led to an increase in investor optimism.

Interestingly, the U.S. dollar continues its upside move against a broad basket of currencies, and the U.S. Dollar Index has settled above the 100.5 level. Typically, positive performance in riskier assets led to weakness of the U.S. dollar which serves as a safe haven asset of last resort during the current coronavirus crisis.

This is an important factor for silver since stronger U.S. dollar is a bearish catalyst for precious metals since it makes them more expensive for buyers who have other currencies.

Simultaneous upside in both the U.S. dollar and the precious metals is a sign of market confusion. On the one hand, investors and traders want to get exposure to riskier assets as they fear that they will miss the next leg of the upside move in the world market. That’s the so-called “fear of missing out”, or FOMO.

On the other hand, the bad economic data and the continued uncertainty on the economic front leads to increased purchases of safe haven assets like the U.S. dollar.

It is also possible that the unprecedented monetary support measures which are being implemented by governments and central banks all over the world have distorted the marketplace. There’s so much liquidity that it can lift the prices of both the safe haven assets and the riskier assets at the same time.

Technical Analysis

Silver is back to the trading range between the 20 EMA near $15.00 and the 50 EMA at $15.50. As the time goes by, the spread between the 20 EMA and the 50 EMA narrows, so traders should expect some more decisive action in the next few weeks.

The 50 EMA serves as the first resistance level for silver. In case it is breached to the upside, the way to pre-crisis levels at $16.50 will be open. However, silver will also have to deal with resistance near the recent highs at $15.80.

On the support side, the 20 EMA serves as the first support level for silver, followed by major support at $14.60. In case the support at $14.60 is breached to the downside, I’d expect rapid downside momentum in silver.