The price of silver has mounted a strong rally in recent weeks to catch up with higher gold prices.
Both have paused due to the market remaining unsure of the Federal Reserve’s intentions.
XAG/USD – Weekly Chart
Silver (XAGUSD) is pushing against a downtrend resistance line at the $24 level on the weekly chart. A move above there could open up a run to the 2021 highs around the $30 level.
Silver, like gold, had been weighed by the aggressive interest rate hikes of the Federal Reserve. As the central bank paused on the pace of its hikes, precious metals rallied. They have now cooled off once more as the Fed maintains a “higher for longer” stance.
Unexpected GDP numbers also took some steam away from metals as silver faced a 1.8% loss on Thursday. However, the trend continues to be higher, and the supply and demand picture should support silver further.
NS Ramaswamy, Head of Commodities, Ventura Securities, said, “The gold-silver ratio is currently at 78:1, and we could expect the regression to mean levels of 60, which is bullish for silver.”
