Silver Price Prediction – Prices Rise but Hit Resistance

Silver prices moved higher on Tuesday, rising for the 5^th consecutive day. The U.S. yield curve continued to flatten, with the 2-year hitting a 21-month high while the 10-year yield eased. The U.S. yield curve (2-year verus the 10-year sovereign yield) is at the flattest level since November of 2020, before many of the COVID vaccines are released. The market tells investors that a slow down could be underway if the Fed moves forward with tightening. Additionally, Apple is closing its stores in New York City. Goldman Sachs requires vaccinations for all employees, which shows a renewed concern for the new COVID variant. There continues to be a shortage of data released in the U.S. until later this week. Gold prices also rallied, providing a bid under silver prices.

Technical Analysis

Silver prices rallied and are poised to test target resistance near the 50-day moving average at $23.50. Support is seen near the 10-day moving average at 22.55. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Prices are overbought as the fast stochastic prints a reading of 86, above the overbought trigger level of 80. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This scenario occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).  The MACD histogram is printing in positive territory with an upward sloping trajectory which points to higher prices.