Silver Price Prediction Depends on Powell’s Testimony, Manufacturing PMI

The silver price prediction for the week will be dictated by trading sentiment in response to the testimony of Fed Chair Jerome Powell before the Senate Banking Committee and the House Financial Services Committee, and the manufacturing PMI data to be released in the US and the Eurozone. 

What has been happening with the XAG/USD pair? A two-day rally on 15/16 June followed a 3.8% drop on 13 June. However, this rally stalled at 21.915 as the US Dollar picked up traction following the Fed’s 75bps rate hike. 

This rate hike has made non-yielding metals such as gold and silver less attractive while pushing market interest toward the higher-yielding USD-denominated assets such as long-term Treasury bills. Ten-year yields hit 3.25%, three-and-a-half-year highs and helped blunt the impact of higher consumer prices, pushing investment flows into precious metals.

Fed Chair Powell is expected to double down on the inflation containment rhetoric of the last Fed meeting. The new Beijing lockdowns and underwhelming PMI data could pressurize silver prices, which could see a greater expression of bearish silver price predictions.

Silver Price Prediction

The symmetrical triangle on the 4-hour chart is the pattern to determine the short-term direction for the XAG/USD pair. A breakdown of the triangle’s lower border must be accompanied by a degrading of the 21.460 support level to clear the path to 21.248. Below this level, 20.985 and 20.661 serve as additional price targets to the south.

On the flip side, a break of the upper border of the triangle targets 21.915 (17 June 2022 high). The previous 61.8% Fibonacci price mark at 22.244 serves as an additional northbound target before 22.465 (2 June 2022) enters the mix as another potential harvest point for the bulls.

XAG/USD: 4-hour Chart