Silver Price Daily Forecast – Silver Rises On Broad Market Optimism

Silver Video 14.04.20.

Equity Market Upside And Weaker U.S. Dollar Help Silver Get To New Highs

Folowing a minor pullback yesterday, silver continues its upside move, helped by broad optimism in the world markets. Investors focus on first signs that major economies will start to reopen for business and favor riskier assets.

Not surprisingly, the U.S. dollar continues to lose ground in these circumstances. Recently, the U.S. Dollar Index breached the psychologically important 100 level to the downside, and now trades near the 99 level.

Weaker U.S. dollar is bullish for silver as it makes it more affordable for buyers who have other currencies. This is an especially important factor given the fact that industrial demand plays a major role in demand for silver.

Gold managed to settle above $1700 per ounce both on a spot and futures basis, and gold’s upside will likely lead to an influx of money into the whole precious metal segment.

Other precious metals like palladium or platinum are also showing upside following gold’s move above $1700, confirming the theory.

Silver is getting closer to pre-crisis levels, and it will likely need continued market optimism to get there fast. This week, the U.S. stock market will get tested by first earnings reports of major companies.

Currently, the market looks prepared to hear bad news, but things may change quickly if earnings reports are accompanied by worse-than-expected guidance. In my opinion, the direction of equity markets may have a significant impact on silver in the upcoming days.

Technical Analysis

Silver is currently testing the resistance level at the 50 EMA at $15.65. In case silver manages to settle above this level, it will have a very good chance to complete the rebound and return to pre-crisis levels at $16.50.

The 20 EMA is now located near $14.90, the support level that has been tested several times and proved its strength. Currently, this is the first major support level for silver.

In case this level is breached to the downside, I’d expect additional support near the previous resistance at $14.60 – $14.70. Previously, I expected more support for silver in the $14.30 – $14.60 area, but as the price of silver (and the 20 EMA) moved higher, so did the expected support level.