Bullish Scenario: CPI Weakened, Fed Rate Cuts Gain Traction
If today’s inflation data is softer than expected, the US dollar could decrease, making silver more attractive to investors. A weaker CPI print would strengthen expectations for a rate reduction of June, which would lower the proceeds from the treasury and would actively improve Silver’s profession as a non-return.
A bullish response could float silver due to its recent peak of $ 33.21, so that the door is opened for an outbreak above the peak of this year at $ 33.39. If the momentum continues, the following upward goals are $ 34.87 and $ 35.40, which would be a significant extension of the upward trend from Silver.
Another potential catalyst for the benefit of Silver is escalating trade tensions. If investors are delivered that rates will slow down worldwide growth, the demand for safe port to silver can increase, which further adds bullish momentum.
Bearish scenario: inflation remains warm, Fed has the rates stable
If CPI becomes stronger than expected, markets can start to praise in a longer period of restrictive FED policy, which strengthens the US dollar and bond returns – both negative for silver. A hot inflation -reading would probably push the expectations for the rate reductions further in the year, reducing Silver’s profession.
In this case, Silver could withdraw to the most important support levels. The first test is $ 32.53, the 61.8% retro level of the recent rally. A interruption below can extend losses to $ 31.81, the 50%retracement level.
If sales pressure is increasing, silver can test its 50-day advancing average average at $ 31.42, with the 200-day advancing average at $ 30.57 as a critical support zone in the longer term. A break among these levels can shift the intermediate trend to neutral or bearish.