Silver price edged lower on Monday; holding below the previously steady support level of $19.00 for the second session in a row. A strong US dollar and recession concerns remain the key bearish drivers into the new week.
Silver price dropped below $19.00 on Friday with the broader metals market remaining on a downtrend. On Monday, copper price dropped to a level last recorded in late July while palladium price a two-week low earlier in the day.
The metals market has been under pressure from the heightened recession fears and subsequent surge in the value of the US dollar. In the past week, the Federal Reserve warned of economic pain as it maintains its aggressive policy tightening with the intent of dealing with the decades-long inflation. The environment of high interest rates and recession fears have boosted the US dollar while weighing on silver price and the broader asset class of commodities.
In the ensuing sessions, silver price movements will be founded on its dual status as an industrial and precious metal. In addition to the Chinese industrial profit data scheduled for release on Tuesday, the market will be keen on the country’s manufacturing PMI on Friday. Besides, the Fed Chair’s speech and US durable goods order on Tuesday, US GDP on Thursday and the PCE price index on Friday will be events worth watching.
Silver price prediction
Silver price extended losses from late last week on Monday; trading below the previously steady support level of 19.00 for the second session in a row. As at the time of writing, it was at 18.82; down by 0.18%.
As shown on its daily chart, it is trading below the 25 and 50-day exponential moving averages. Based on both the fundamental and technical indicators, the asset will likely remain under pressure for the rest of the week.
In particular, I expect silver price to continue trading below the critical support-turn-resistance level of 20.00 in the ensuing sessions. The range between the 50-day EMA at 19.43 and the support level of 18.33 will be worth watching for the remainder of the week. A move below the range’s lower border will give the bears an opportunity retest the psychological zone of 18.00.