Silver price returned to the upside on Wednesday, inching up by 0.1% to trade at $32.76 during the European trading session. The US economy printed out weak Consumer Confidence data on Tuesday, signaling an underlying weakness. The February Consumer Confidence was 98.3, missing the consensus figure of 102.1 and down from January’s 105.3.
With the US economy sending warning signs, investors are increasingly lining their portfolios with safe-haven assets, and the sentiment favors silver price upside. Moreover, US President Donald Trump has indicated that the trade tariff war against US trading partners is likely to escalate.
Three sets of tariffs are set to come into effect in March and April, raising the stakes across equities and commodities markets. These are 25% tariff against imports from Canada and Mexico, 25% tariff against pharmaceuticals, automobiles and semiconductors and “reciprocal” tariffs against additional trade partners. That could muddy the waters and increase risk aversion in the markets, raising the demand for safe haven silver.
The momentum on silver price is currently bullish-leaning, with the 20-SMA above the 50-SMA on the daily chart. Also, the Relative Strength Index (RSI) on the commodity on the daily chart is at 50.9, adding credence to the likely continuation of the upward momentum. However, the Average Directional Index (ADX) reading is at 18, which signals a weak trend. Therefore the sellers could put up a fight and limit silver price upside in the near-term.
Silver Price Prediction
Silver price pivots at $31.67 and action above that level signals dominance of the upside momentum. The buyers will likely meet initial resistance at $31.90. However, an extended control could break above that level and potentially test the second hurdle at $31.08.
Alternatively, going below $31.67 will signal the onset of control by the sellers, with the first support likely to be at $31.54. However, if the price breaks below that level, it will inavlidate the upside narrative and could test the second support at $31.40.
