Silver Price Daily Forecast – Widespread Optimism In Precious Metals Boosts SilverSilver continues its upside move and tests the nearest resistance level.
Silver Video 20.05.20.
Silver Tests The $17.50 Level
Silver continues its upside move, boosted by general rally in the precious metal segment and the weaker U.S. dollar.
As I previously noted, gold’s ability to stay above the key $1700 level should increase the flow of money into the precious metal segment.
Gold is currently trading close to $1750 per ounce, while platinum and palladium are in a rally mode. This positive mood is bullish for silver which tries to settle above the resistance at $17.50.
The weaker U.S. dollar is also playing its role. The U.S. Dollar Index, which measures the strength of the American currency against a broad basket of currencies, has settled closer to the 99 level.
The U.S. Dollar Index remains in a range between 99 and 101, and a downside breakout will be bullish for silver as cheaper U.S. dollar makes silver more attractive for buyers who have other currencies.
The equity market is getting closer to new post-crisis highs so demand for safe haven assets like the U.S. dollar may decrease further, providing additional support for silver.
Silver is trying to settle above the key resistance level at $17.50. Silver has already made several attempts to get above $17.50 but met material resistance.
RSI is in the overbought territory, and silver may need a minor pullback before it is able to get above the nearest resistance level.
I’d note that gold/silver ratio has met support at the 100 level . RSI for the gold/silver ratio is in the oversold territory, suggesting that silver might experience some headwinds in the upcoming trading sessions unless gold prices get above $1750 per ounce and provide an additional boost for the whole precious metal segment.
In case silver is able to settle above $17.50, it will likely experience additional upside momentum and head towards the next support level at $18.15.
On the support side, the nearest support for silver is located at pre-crisis levels at $16.50. Silver upside was fast so no additional levels were formed between $16.50 and $17.50.
In case silver gets below $16.50, it may gain increased downside momentum and head towards the 20 EMA level which is near the April highs at $15.80.
The 20 EMA has recently crossed the 50 EMA to the upside, suggesting increased upside momentum, but the overbought situation in silver and the oversold situation in the gold/silver ratio may lead to increased resistance in the near term.