The price of Silver (XAG/USD) has rebounded after finding support near $33.00 in Friday’s New York session following the release of the US Durable Goods Orders data for September. The report indicated a steady contraction of fresh demand for long-lasting goods by 0.8%, which was slower than the expected 1.0% decline. This led to a decline in the US Dollar Index (DXY), with the 10-year US Treasury yields falling to around 4.19%. Lower yields make non-yielding assets like Silver more appealing as the opportunity cost of holding such investments decreases.
Despite facing pressure in recent trading sessions due to profit-taking after reaching a 12-year high close to $35 on Tuesday, Silver has regained strength. The market sentiment has improved as investors anticipate former US President Donald Trump winning over current Vice President Kamala Harris in national elections on November 5. Additionally, the S&P 500 has opened positively on Friday, indicating an improvement in risk appetite. The visit of US Secretary of State Antony Blinken to Saudi Arabia has also raised hopes for a ceasefire in the war between Iran and Israel, which may further impact Silver prices.
From a technical analysis perspective, Silver is aiming to revisit its recent high near $35 after bouncing back from $33.00. The asset has broken above a horizontal resistance line and is supported by upward-sloping 20- and 50-day Exponential Moving Averages. The 14-day Relative Strength Index (RSI) is above 60.00, suggesting an active bullish momentum. Investors looking to trade Silver have various options, including buying physical silver in the form of coins or bars, or trading through Exchange Traded Funds that track the metal’s price on international markets.
Silver prices are influenced by a variety of factors, including geopolitical instability, fears of recession, interest rates, the strength of the US Dollar, investment demand, mining supply, and recycling rates. The metal is widely used in industry, particularly in electronics and solar energy sectors, due to its high electric conductivity. Demand from major economies like the US, China, and India can also impact prices. Silver tends to follow Gold’s price movements as both are considered safe-haven assets. The Gold/Silver ratio can provide insight into the relative valuation of the two metals, with a high ratio suggesting Silver may be undervalued compared to Gold.
In conclusion, the rebound in Silver prices following the release of the US Durable Goods Orders data indicates renewed interest in the precious metal as an investment asset. Factors such as market sentiment, geopolitical events, and industrial demand will continue to influence Silver prices in the coming days. Investors should keep a close watch on key indicators and technical analysis to make informed decisions when trading Silver.
