Silver Price Daily Forecast – Silver Tests Support At $17.00

Silver Video 15.06.20.

Fears Of A Second Wave Of COVID-19 Put Pressure On Silver

Silver is under pressure today as fears of a second wave of coronavirus have dragged the world markets into the negative territory.

The precious metal segment is under pressure, and gold has declined closer to the key $1700 level. While gold serves as a safe haven asset, it may experience weakness at times of a broad market sell-off as traders raise cash to deploy it later when markets reach lower levels.

Gold/silver ratio has returned to 100 which is bearish for silver. A potential second wave of coronavirus will put additional pressure on the economy while industrial demand is a major component of demand for silver.

Thus, it’s not surprising to see an increase in gold/silver ratio in current circumstances. I’d note that gold/silver ratio has recently crossed the 20 EMA to the upside, increasing chances for additional upside momentum.

Interestingly, the U.S. dollar is not gaining ground amid broad market panic, and the U.S. Dollar Index is under some pressure. A weaker U.S. dollar is bullish for silver as it makes it cheaper for buyers who have other currencies. However, the pressure from general market downside is too strong, and dynamics of the American currency have little impact on silver today.

Technical Analysis

Silver managed to get below the support at $17.50 and is testing the next support level at $17.00. This is a very important moment for silver price dynamics in the upcoming weeks.

The support level at $17.00 has previously been tested many times and proved its strength. In case silver manages to settle below $17.00, it will likely gain additional downside momentum and start a near-term downside trend.

In this scenario, silver will head towards pre-crisis levels at $16.50. The 50 EMA is at $16.65, so traders should expect to see support for silver in the range between $16.50 and $16.65.

On the upside, the nearest resistance for silver is located at $17.50. The 20 EMA at $17.30 may also serve as a resistance level, so silver will likely need more upside catalysts to get above $17.30 – $17.50 area.

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