. Silver News: U.S. Inflation Impact - Capital Street FX

Silver News: U.S. Inflation Impact

12 Mar 2024

XAG/USD is confined within a narrow range of around $24.50 in anticipation of U.S. inflation data.

FUNDAMENTAL OVERVIEW:

  • Silver is in consolidation mode around $24.50 before the release of U.S. inflation data.
  • Anticipated deceleration in the core CPI, along with potentially sticky headline inflation, awaits confirmation.
  • A clear catalyst is required for silver to decisively break above $24.60.

In Tuesday’s European session, silver (XAG/USD) remained within a tight range near $24.50. Since the previous Friday’s trading session, the white metal has encountered difficulty establishing a clear direction. Anticipation surrounds the potential breakout from this sideways trend following the release of the United States Consumer Price Index (CPI) data for February, scheduled for publication at 12:30 GMT.

The expected monthly increase in headline inflation is projected to be 0.4%, up from January’s 0.3%. Concurrently, core inflation, excluding volatile food and energy prices, is predicted to show a slower growth rate of 0.3%, compared to the previous reading of 0.4%. In terms of annual figures, economists anticipate the headline Consumer Price Index (CPI) to persist at 3.1%, while core inflation is expected to decelerate to 3.7% from January’s 3.9%.

The prospects of Federal Reserve (Fed) rate cuts in the June policy meeting will be notably shaped by the unveiling of inflation data.

SILVER TECHNICAL ANALYSIS DAILY CHART:

Technical Overview:

Silver is trading within an up channel.

Silver is positioned above all the Moving Averages (SMA).

The Relative Strength Index (RSI) is in the Buying zone, while the Stochastic oscillator suggests a Positive trend.

Immediate Resistance level: 24.51

Immediate support level: 24.15

HOW TO TRADE SILVER

Following an upward price movement, silver has entered a consolidation phase within a specific range. Currently, silver is making efforts to advance and is trading in proximity to a crucial resistance zone. Should this zone be breached, there is potential for further upward movement.

TRADE SUGGESTION- STOP BUY– 24.58, TAKE PROFIT AT- 25.07, SL AT- 24.36.