Silver Price Forecast: PBoC Liquidity's Impact on Future Gains
Market Analysis
Silver (XAG/USD) opened the week with a slight bearish trend while maintaining its position above the pivotal support level of $30.98. The caution surrounding upcoming US Purchasing Managers Index (PMI) data is creating a complex backdrop for market sentiment. Additionally, weaker US dollar conditions and the Federal Reserve’s recent rates adjustments are elevating silver’s attractiveness as a safe haven.
PBoC's Role in Silver Demand
In an effort to stimulate economic engagement, the People’s Bank of China (PBoC) initiated a substantial liquidity injection of CNY 74.5 billion through a 14-day reverse repo operation, lowering interest rates to 1.85%. This strategic move suggests a potential rise in industrial demand for silver, as robust liquidity supports manufacturing momentum.
Silver Price Technical Analysis
- Current price of silver stands at $30.98
- Resistance levels at $31.42, $31.75, and $32.08
- Support identified at $30.72 and $30.27
As liquidity cascades into industrial applications, there lies a tangible opportunity for price gains as 2024 unfolds. Traders should monitor key targets and potential downside risks closely.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.