Silver prices rise as dollar weakens and banking fears ease – 29 March
29 Mar 2023
- Silver prices rose by 0.94% on Tuesday, settling at 70584, as the US dollar index slipped for the second consecutive session, boosting demand for the metal. Reports of First Citizens Bank Shares buying significant holdings of Silicon Valley Bank and CNBC’s revelation that outflows from small institutions to banking giants had slowed helped ease fears over recent banking turmoil.
- US authorities are looking to shore up confidence by considering an expanded emergency lending facility and assuring markets that the US banking system is sound and resilient. The Silver Institute predicts that silver will continue to be an important fashion accessory, supporting demand and prices through 2023.
- The market is technically under fresh buying with resistance likely at 70983 and support at 69871. Investors are now awaiting key inflation data and speeches from Fed officials this week.
- The latest data from the US Labor Department shows that the number of new jobless claims filed last week decreased slightly, suggesting that the recent banking instability had minimal impact on the economy.
- Initial applications for state unemployment benefits dropped by 1,000 to 192,000 for the week ending March 18. Meanwhile, St. Louis Federal Reserve President James Bullard expressed confidence that the stress in the banking sector would subside and emphasized the need for the Fed to raise interest rates more than originally anticipated.
- From a technical standpoint, the market is currently experiencing long liquidation, as open interest dropped by -2.49% to settle at 13505, while prices fell by -485 rupees. Support for silver is now at 69594, and a drop below this level could lead to a test of 69263.
- Resistance is expected at 70332, and a rise above this level could push prices to test 70739.