Factors pushing silver higher

Silver (XAG/USD) ended the daily session in gains for the third consecutive time, recording a 14-year record, surpassing the $42 mark during the Asian session. This remarkable uptick was largely due to the increasing bets on Federal Reserve interest rate cuts, fueled by mounting signs of weakness in the US labor market. 

Silver Price Analysis: Rate-Cut Bets, Safe-Haven Flows, and Industrial Demand

Weekly jobless claims have reached their highest numbers since 2021, signaling a likely three-time interest rate cut before the end of the year. In addition to weakened economic data directing the Fed towards a more dovish monetary policy, geopolitical tensions are increasing the attractiveness of silver as a safe haven asset.

High industrial demand for silver also remains a big factor in driving prices higher, especially in solar energy, electric vehicles (EVs), and electronics production, which are facing scarcity of supply at the moment. 

This unique blend of economic, geopolitical, and industrial factors puts silver in a strong position, pushing it beyond pre-2011 price levels and building hopes for further rise in the coming future. 

 

Technical analysis of silver price

A graph on a screen AI-generated content may be incorrect.Figure 1: XAG/USD, H4, TradingView 

 

Silver’s current trading trend is largely an uptrend, creating consecutive higher highs and higher lows, as buyers push prices higher.

The price retraced after reaching the $40.83 level to continue to break it and reach as high as $41.966 on both the short and medium timeframes.

In the 4-hour timeframe, the $40.39 level stands as the primary support level. Breaking this level downwards and closing the session (4-hour) at a lower price will be considered a sell sign and a clear signal for a reversal, according to analyst analysis.

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