Friday has presented an uptick in silver prices, as the asset followed gold upwards following a rise in the forward projection from Goldman Sachs on gold and silver prices. According to Goldman Sachs, it sees gold prices hitting $2000 in 12 months, while its silver price outlook for three, six months and a year has risen to $19, $21 and $22. Previous figures for the 3-months and 6-months projection stood at $13.50 and $14, showing that Goldman has upped its forward guidance for silver prices by 50%.
Silver prices on the XAGUSD pair are up 1.76%, and the daily candle shows the asset is receiving strong bids. Today marks the expiration date of several futures and options contracts and traditionally generate some volatility on metal assets. Silver is given the number two status in terms of trade preference after gold, and investors are now starting to look the way of the white metal after a while in consolidation.
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Outlook for XAGUSD
Silver price on the XAGUSD pair are up 1.8% and is currently trading at 17.69874. The asset is nearing the convergence point of the trendlines that form the consolidation phase of the bullish pennant pattern. The technical expectation of the pattern is for the price to break to the upside. If this plays out as expected, silver prices could target the 18.14191 price level, with the 18.64935 price area hanging overhead in case the price advance continues.
On the flip side, if price chooses to breakdown the pennant instead, this negates the pattern and allows the move to target the 200-SMA location at 16.99205 (38.2% Fibonacci retracement from 5 May low to 1 June high). Below this price level, further support targets lie at the 50% Fibo levels (16.58888) as well as the 16.14694 and 15.80160 price levels.