Silver prices experienced a significant drop, falling 3.86% due to the influence of strong US Treasury bond yields and a robust US Dollar. The current trading price for silver stands at $29.53, marking a decline after two consecutive days of gains.
In terms of technical analysis, the outlook for silver appears bearish as indicated by the formation of a bearish engulfing pattern on the chart. Additionally, the Relative Strength Index (RSI) has turned bearish, suggesting the possibility of further declines in the price of silver.
Key support levels to watch for include the 50-day moving average (DMA) at $29.09, followed by $29.00 and the month-to-date (MTD) low of $28.66. If these levels are breached, the price could potentially drop towards the 100-DMA at $26.60.
Conversely, if silver manages to reverse its trend and move upwards, it will encounter resistance at the June 7 high of $31.54. A successful breach of this level could lead to a push towards $32.00 and eventually challenge the year-to-date (YTD) high of $32.51.
It is important to note that the information provided in this analysis contains forward-looking statements and should be used for informational purposes only. It is advisable to conduct thorough research before making any investment decisions. The risks associated with investing in open markets, including the possibility of total loss of principal, should be carefully considered.
Overall, the current market conditions suggest a bearish outlook for silver prices in the short term, with potential support and resistance levels outlined for traders to monitor. Stay informed and exercise caution when making investment decisions in the volatile precious metals market.