The Silver price is in a consolidation mode as investors reflect on the ongoing global recovery, monetary policy, and the potential for supply increase. It is trading at $26, which is 128% above its lowest level last year.
Silver news: Silver ended April in the red as the market reflected on the strong economic data. Recent data showed that manufacturing production and demand has surged. For example, on Friday, data revealed that US personal consumption rose to the highest level on record. This strong performance is usually a good thing for silver because it is a sign of higher demand.
However, the data also is usually an indicator that the Fed will start tightening, which is usually a bad thing for silver prices. Therefore, in May, the market will be focusing on more data from the United States to gauge whether the economic recovery will continue.
Further, the silver price will react to the progress on America’s infrastructure spending, A possibility of a bill will lead to signs of more demand for the metal.
Silver price forecast
The daily chart shows that the silver price has been in a consolidation mode. This is evidenced by the fact that the price is along the short and longer-term moving averages. Also, the Average True Range (ATR), which is an important measure of volatility, has also declined sharply.
The Relative Strength Index (RSI) has remained at 54, which is a sign of neutrality. Still, the pair has formed a triangle pattern that is shown in red. Therefore, we can’t rule out a major bullish or bearish breakout in May. The key levels to watch will be $30 and $24, respectively.
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