Silver Prices Hover Below the 200-Day Moving Average as Dollar Strengthens 

Key Insights

• Silver prices stabilized amid rising inflation concerns.
• Benchmark yields continued to fall amid China’s Covid outbreak and concerns over an economic slowdown.
• Oil prices recovered following the sharp decline in China shutdown concerns.

Silver prices continue to decline as the dollar strengthens. A stronger dollar makes commodities like silver more expensive for buyers to purchase in other currencies, which reduces demand.

Benchmark yields continued to fall several basis points due to uncertain growth sentiment and lingering concerns over China’s Covid situation. Gold prices rose 0.66% after pulling back for three consecutive days as investors looked for a safe haven from weakening economic growth and spiraling inflation.

Oil prices moved higher after tumbling due to demand loss from China’s Covid-19 shutdowns. 1 million barrels were lost due to China’s shutdowns. Several economic data points were released today.

Durable goods orders, which are products meant to last at least three years, increased by 0.8% for the sixth time in seven months. Orders for durable goods fell in February by a revised decline of 1.7%. Core orders advanced 1% this month.

Investors view these orders as a signal of future business prospects and might help economists finalize Q1 GDP forecasts, so the increase from the last month is encouraging. 

However, the economic data is not going to sway the Fed of its hawkish monetary policy. US Q1 GDP and Core PCE data will likely underpin the hawkish Fed decision.

Technical Analysis

Silver prices remain below the 200-day moving average of $23.52 after dropping for the fifth consecutive trading session. Silver prices will continue to face downward momentum amid Fed tightening and could pull back to support near the February 2022 lows near $22. 

Support is seen near the 200-day moving average of $22.776. Resistance is near the February 15th low near $23.03. Short-term momentum is negative but converged as the fast stochastic might have a crossover buy signal.

The medium-term momentum turned negative as the histogram prints negatively with the MACD (moving average convergence divergence). The trajectory of the MACD histogram is in negative territory, which reflects the downward trend in price movement.