Silver price has been on a path to recovery in recent weeks. The reopening of China, coupled with hopes of a dovish Fed, have largely been behind the rebound. However, this recovery is be tried and tested in the ensuing sessions.
Of major importance to investors in the silver market is the US CPI numbers on Tuesday and Fed interest rate decision on Wednesday. A decision by the Fed to continue with its aggressive interest rate hikes may subvert the bulls’ efforts to break the resistance at $24.00.
Later in the week, Chinese industrial production data is set to impact silver price movements. The figures sill shed some light on the metal’s demand status in the leading consumer nation globally.
Silver price prediction
In early September, silver price dropped to its lowest level since June 2020 at $17.56 amid a strong US dollar and heightened concerns over its industrial demand. However, it has been on a rebound; recording higher highs and higher lows since then.
Notably, the economic events encompassed in the new week will be a key determinant of silver price movements in the short term. In particular, they will determine if the metal will break the resistance at the crucial level of 24.00.
With reference to technical indicators, it was trading above the 25 and 50-day exponential moving averages as seen on its daily chart. However, even with this bullish sign, I expect silver price to record subtle movements in the immediate term as traders await further cues in the form of US inflation data and Fed interest rate decision.
To be more specific, the range between 22.75 and 23.34 will be worth watching. Even with a rise past the range’s upper border, I still expect it to continue trading below 23.90 ahead of the Fed interest rate decision. Less aggressive interest rate hikes by the Fed will likely boost silver price past the psychological level of 24.00 as the bulls eye the next target at 24.50. However, this bullish thesis will be invalidated by a move below the support at 22.22.