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Silver Price Daily Forecast – Silver Settles Back Above $17.50

By:
Vladimir Zernov
Updated: Jun 9, 2020, 14:08 UTC

Silver remains in the upside trend after it managed to quickly rebound from recent sell-off.

Silver

Silver Video 09.06.20.

Gold’s Upside Helps Silver Stay Above Support At $17.50

Yesterday, silver managed to return above $17.50. Today, silver stays above this level. The U.S. stock market is finally losing some ground which increases demand for safe haven assets and provides support to the precious metal segment.

Gold has managed to settle back above $1700 per ounce which is a material bullish development. The area between $1680 and $1700 remains a major support level for gold.

Now that gold has proved that it is able to stay above the $1700 level at a time when the U.S. stock market is close to highs, traders could use gold as a hedge against the potential market downside.

This scenario will be very favorable for the whole precious metal segment as higher gold prices attract investment in other precious metals including silver.

Gold/silver ratio has rebounded to 97 and does not continue its downside move. I maintain my view that the return to pre-crisis levels below 90 is still possible, although silver may have upside even with higher gold/silver ratio in case gold rallies.

The U.S. dollar is trying to rebound today but this attempt is not strong, and the U.S. Dollar Index remains in the range between 96.5 and 97. Today, the dynamics of the American currency are neutral for silver.

Technical Analysis

XAG/USD Daily Chart

Silver briefly dipped below the support at $17.50 but quickly returned back above this level. It has already made another attempt to get below $17.50 but this attempt was immediately stopped.

In case silver continues to stay above $17.50, it will gain more upside momentum and head to test the nearest resistance level below $18.50. RSI has pulled back from the highs reached at the beginning of June so silver has material chances to develop more momentum.

In case the test of the resistance level at $18.50 is successful, silver will head towards the major resistance at $19.00.

On the support side, the nearest support at $17.50 just got confirmed. In case silver manages to get below this level, it will head towards the low of the recent pullback near $17.20.

The major support level for silver is located at $17.00. If silver settles below this level, the current upside trend will come to an end, and silver will develop downside momentum.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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