Silver price nears $30.60 following U.S. CPI data release
Silver struggles to recover as $29.80 resistance blocks rebound attempts
Silver's price outlook is in a delicate balance, influenced by both technical factors and broader macroeconomic conditions.
After a sharp 3% decline on Monday, Silver has struggled to recover to the $30.60 level, with the $29.80 level proving to be a significant point of contention.
The price decline on Monday stemmed from the 50% Fibonacci retracement level and further breached the key $29.80 support, reaching a four-day low. As the price attempts to recover, the $29.80 level is now acting as resistance, confining movement within a narrow range. At this level, a significant hurdle is presented by the 100 EMA on the 4-hour chart, adding further resistance to any potential breakout to the upside.
Silver price dynamics (November 2024-January 2025). Source: TradingView
Silver price forecast: breakout above $32 resistance or further decline
Silver continued to hover around the $30 mark during European session, as the market awaited confirmation of either a bullish breakout or a continuation of the downtrend. A breakout above this resistance could pave the way for a more sustained recovery, allowing Silver to gain ground and possibly revisit higher levels. However, further weakness could signal a resumption of the downtrend, potentially forcing the price to test lower levels and revisit recent lows.
On the macroeconomic front, China's recent stimulus measures could provide support for industrial metals, including Silver. As the world's largest consumer of metals, any improvement in China’s economic conditions could boost demand, especially given Silver's industrial applications.In summary, Silver’s outlook remains tied to the technical resistance at the $30 level and the broader macroeconomic drivers discussed.
Silver prices have been pressured by the latest Nonfarm Payrolls report and a dip in the Unemployment Rate. Despite this, Silver's RSI remains above 50, indicating ongoing upside momentum.
