Silver’s recent performance shows a bullish trend, with prices stabilizing around $28 per ounce after briefly touching a three-year high of $28.9.
Mike McGlone, Commodity Strategist at Bloomberg, highlighted on X (formerly Twitter) on April 19, 2024, the promising trend in silver prices, drawing a parallel with last year’s cocoa market before it hit new highs.
McGlone drew an intriguing comparison between the movements in silver and those previously seen in the cocoa market, where prices escalated after a similar period of stagnation. This pattern suggests a promising outlook for silver, especially as it follows gold‘s lead, which recently escalated to record levels above $2,000 an ounce.
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The easing of geopolitical tensions, particularly in the Middle East, and a solid base in industrial demand are providing strong support for the metal. The transition of the previous resistance level at $26 into a new support level mirrors similar movements seen in gold, suggesting a strong foundation for further gains.
A Combination of Cocoa and Gold? Silver’s Cage Escape Faces $30 – Silver has broken free from an extended period within a narrow price cage, similar to what cocoa did a year ago before it made new highs. A solid base for the metal and gold’s rise to a record suggest it may be a matter of time for silver to top $30-an-ounce resistance
– Mike McGlone
The technical landscape for silver now centers on the $30 per ounce resistance, a critical point that has historically capped gains.
The current momentum in the silver market is further buoyed by increased industrial demand, particularly from sectors reliant on silver for manufacturing, such as electronics and solar power. This demand, coupled with inflationary pressures and currency devaluation fears, adds to silver’s appeal as a safe-haven asset.
Market outlook and silver price analysis
Analysts remain optimistic about silver’s potential to test and possibly exceed the $30 per ounce mark. Green energy technologies regularly use silver, so an increase in demand for these sectors would be beneficial for silver.
According to the International Energy Agency, renewable energy capacity increased by 50% globally last year. As governments and consumers pivot more towards sustainable energy sources, the industrial demand for silver is expected to continue outstripping its stagnant global supply output.
Since March 28, 2024, Silver (XAGUSD) has experienced a steady increase in price.
Currently, the key resistance level to watch is $28.90. If the price breaks above this level, it could signal a shift to a bullish market sentiment.
Conversely, the support levels to consider are $27.50 and $26.00, which may offer temporary stability. The 52-week low for silver stands at $21.09, acting as a significant long-term support level.
This steady rise and the critical resistance point suggest that the market dynamics for silver are at a potential turning point, where breaking past $28.90 could lead to further bullish trends.
As the market continues to watch silver’s performance closely, the convergence of these factors—gold’s influence, industrial demand, economic uncertainties, and supply tightness—makes a compelling case for silver’s continued ascent.
The metal’s ability to sustain this breakout and establish a new higher trading range will be critical in determining its trajectory in the upcoming months.
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