Silver continues to trade within a narrow range of $2.00, with $30.60 serving as a key pivot level for the market. A move below $29.64 would be a sign of further bearish momentum, while a break above $31.54 could reverse the trend to bullish. The 50-day moving average at $31.71 remains a strong resistance point, with its break necessary for more significant upward movement.
The current technical setup suggests indecision, but Powell’s comments could provide clarity on the market’s next direction.
Fundamental Drivers and Safe-Haven Support
Despite the recent dip, silver has found some support from safe-haven demand as geopolitical tensions in South Korea and France add to market uncertainty. In South Korea, lawmakers have called for the resignation of President Yoon Suk Yeol, while in France motions of no confidence threaten the government of Prime Minister Michel Barnier.
At the same time, the US dollar index remains strong, adding downward pressure on silver. The stronger dollar makes silver more expensive for holders of other currencies, offsetting silver’s appeal.
Powell’s speech in focus
All eyes are on Powell’s speech in New York, where he is expected to discuss the US economy and monetary policy in a moderate discussion. Markets are particularly interested in his comments on inflation and future rate cuts ahead of the December 17-18 Fed meeting. According to CME Group’s FedWatch Tool, current market odds indicate a 74% probability of a 25 basis point rate cut.
Powell’s insights will complement this week’s other key events, including today’s ADP employment report and Friday’s nonfarm payrolls data. Both reports could further shape expectations for the Fed’s next steps, with labor market conditions being a crucial factor.