HG MARKETS:

Silver prices saw significant gains in recent trading sessions, surging to an intraday high of $31.4585. This upward movement was underpinned by a notable development in the US economic landscape—the Consumer Price Index (CPI) data for June revealed a surprising decline in inflation. This unexpected decrease has sparked optimism among investors regarding potential interest rate cuts by the Federal Reserve later in 2024.

According to the latest report from the US Bureau of Labor Statistics, consumer prices fell in June, a trend that has raised expectations of forthcoming monetary policy adjustments aimed at supporting economic growth. The news exerted downward pressure on the US dollar, which further bolstered demand for commodities like silver as a hedge against inflation and currency depreciation.

Looking ahead, market participants are closely monitoring upcoming economic indicators, including the Producer Price Index (PPI) for June and the University of Michigan Consumer Sentiment survey. These reports will provide additional insights into economic conditions and could influence future movements in silver prices.

The combination of easing inflationary pressures and the increasing likelihood of Fed rate cuts has created a favorable environment for silver and other precious metals. The weakening US dollar, alongside strong economic indicators such as a decline in initial jobless claims, underscores the supportive backdrop for silver as investors seek assets that can benefit from lower interest rate expectations.

From a technical standpoint, silver is currently trading at $31.22, showing a minor decline of 0.71%. Immediate resistance levels are identified at $31.46, $31.77, and $32.06, while support levels stand at $30.88, $30.65, and $30.43. Technical indicators, including the 50-day Exponential Moving Average (EMA) at $30.96 and the 200-day EMA at $30.27, suggest a bullish outlook as long as prices remain above the pivot point of $31.12. However, a break below this critical level could potentially trigger selling pressure in the silver market.

In summary, silver prices have benefited from recent economic data indicating softer inflationary trends and the prospect of monetary stimulus measures. Investors will continue to monitor economic releases closely for further guidance on market direction, while technical indicators highlight key price levels and potential support and resistance zones for silver in the near term.