Silver price was in the green for the third session in a row on Thursday as the market digests the FOMC meeting minutes. Even so, the persistent inflation woes are curbing its gains. As at the time of writing, it was at $21.51; down by 0.03%.
Fundamentals
The financial markets are digesting the Fed meeting minutes released on Wednesday; an aspect that has continued to boost silver price. As a precious metal, the asset has been under pressure from the central bank’s ultra-hawkish stance. In fact, in September, it dropped to its lowest level since June 2020 at $17.54.
After approving interest rate hikes of 75 basis points over the past four meetings, the latest minutes showed that the bank’s officials agree that a lesser rate increase should happen soon. Subsequently, the markets are pricing a 50 basis points increase during the Fed’s meeting in December.
On the one hand, expectations of a slower pace of rate hikes has been positive for silver price. Even so, the Fed officials are still concerned about high inflation. As an industrial metal, inflationary pressures has been largely behind the persistent demand woes. Indeed, this explains why silver price has continued to trade below the crucial level of $22.00.
Silver price prediction
Silver price is in the green for the third session in a row; trading above the 25 and 50-day exponential moving averages. Besides, since early September, it has been hitting higher highs and higher lows as highlighted with the arrows shown in the chart below.
In the ensuing sessions, the range between the 25-day EMA at 20.67 and the resistance level at 21.94 will be worth watching. If the market attracts more buyers, silver price may rally past the psychological level of 22.00 to find resistance at 22.22. However, a move below the 25-day EMA will invalidate this bullish thesis.
