The price of Silver continues as gold prices continue to ramp higher due to the event that unfolded this week, with the Fed ramping up its balance sheet to stave off another financial crisis.
Silver prices rose in the former weekly close after a short hiatus from gains yesterday off five-week highs, with the US dollar currently declining against major rivals due to the Fed liquidity measures.
The shiny metal also posted its largest weekly profit in 2023 on strong demand for safe havens amid growing concerns about the global banking sector following the collapse of several local US banks and the crisis with the Credit Suisse bank in Europe.
Demand is also strong from Asia. For example, recent data showed China’s industrial output accelerating in February, with Chinese retail sales rising as expected in February.
This type of data bolstered hopes of improving Chinese activities and improving demand for precious metals such as gold and silver after the government eased Covid 19 restrictions.
Current sentiment metrics towards silver show that traders are turning more bullish towards the price of silver. The ActivTrader market sentiment tool shows that 83 percent of traders are bullish towards silver.
While this is no one-way sentiment bias for the silver price as retail has been heavily leaning on the buy side and may have been squeezed during the latest price dip. In my opinion, this is a bullish sign.
Silver short-term Technical Analysis
The short-term technicals for the shiny-metal shows that silver has reversed to the downside and formed a huge reversal pattern, with the break above $22.50 the next key level.
Looking more closely at the size of the price pattern and measuring the pattern, we are probably going to see a breakout in the region of $2.00 at some point. Taking silver towards $24.50.
Silver Medium-term Technical Analysis
The daily chart shows that silver price is in good shape over the medium-term horizon while the price holds above its 200-day moving average, close to $21.00.
Fibonacci analysis shows that a key extension targets for silver currently sit around $27.00. In reality a move above $25.00 would be needed to attain this price target.