Silver Prices Forecast: Traders Eyeing Psychological Target at $30

Silver’s Ascending Trend

Silver is maintianing its upward movement, marking its third session of gains. The market is seemingly undeterred by the anticipation of the Federal Reserve meeting and the U.S. consumer inflation report. Contributing factors include softer Treasury yields and a stable U.S. Dollar. Silver’s trend is being largely influenced by the gold market’s robust rally, spurred by central bank purchases, expectations of interest rate cuts, and enduring inflation concerns.

At 12:24 GMT, XAG/USD is trading $27.99, up $0.14 or +0.51%.

Gold’s Impact on Silver

Gold’s rally, now at a record high for eight consecutive sessions, is providing significant support to silver. This rally is underpinned by momentum-driven fund buying and escalating geopolitical tensions. The strong performance of gold, encouraged by various factors, including aggressive central bank purchasing and a likelihood of rate reductions, is a key driver of silver’s current price levels.

Market Influences and Technical Outlook

While the market is attentive to concerns like reduced expectations for rate cuts and geopolitical risks, the primary focus remains on upcoming U.S. inflation data and Federal Reserve policy meeting minutes. Normally, high interest rates reduce the appeal of non-yield assets like gold, yet it has shown resilience. From a technical standpoint, silver has reached an overbought state, as suggested by its relative strength index, with efforts to stabilize above $28.

Positive Projections for Silver

Analysts, notably from Bank of America, predict a bright future for precious metals. They anticipate gold reaching $3,000 per ounce by 2025, which would also positively impact silver prices, potentially pushing them above $30 within the next twelve months. This bullish perspective is bolstered by strong industrial demand and the expected rise in gold prices.

Bullish Short-Term Outlook

In the short term, the silver market seems geared towards a bullish phase. Aligning with gold’s impressive performance, coupled with favorable technical indicators and positive forecasts from analysts, the outlook for silver prices points towards continued upward movement.

Technical Analysis

Silver (XAG/USD) continues its strong breakout rally with some traders now convinced the market has its eyes set on $30.00.

The tone of the market is bullish, but a break under $26.28 will change the minor trend to down. The intermediate and long-term support is at $24.03 and $23.51, respectively.

The chart pattern that bullish traders should be most concerned about is the closing price reversal top. This puts the focus on $27.85 into the close today.