Silver Price Prediction: Silver Price Rockets Amid Banking Crisis

• Silver Futures trading at almost $25 per ounce, registering a 12-month high.
• The rise could be a result of the Federal Reserve hinting at slower rate hikes in the future.

Silver Futures were trading at about $25 per ounce, marking a 12-month high, since April 2022. The rally was observed after the banking sector saw a collapse of several major banks, causing liquidity crunch. Another reason for Silver to take the road up is the Federal Reserve going slow or even ending the tightening cycle. The revision of rates by the Federal Reserve can spin the market in alternate ways, and this time it might be bullish.

Silver Set to Propel

The Silver price has enjoyed significant gains since the drop around the $20.00 mark in the beginning of March. The rally matched the timeline of collapse of the Silicon Valley Bank. Silver, much like other futures, seems to have benefitted from the weakness in the US Dollar, due to the liquidity crunch caused by major bank collapse. 

The next FED meeting will revise the rate according to the prevailing market situation. Since the cycle of record high FED rate hikes has presumably stopped, the bears might be catching a breath. The present bullish pattern in Silver Futures is a sign of the market being under bullish influence.

The market for Silver and other precious metals is aided by a weakening US Dollar. The US Dollar Index dropped by 8% over the past three months. A few micro economic aspects like increasing industrial use of Silver could also help in forming an uptrend for Silver Futures.

Silver Futures Price Analysis

Silver Futures rose shortly after the contract switch from SIH2023 to SIK2023, coincidentally matching with the Silicon Valley Bank Collapse. The trading volume turned bright green as many investors flooded the market. The price of Silver Futures breached the rising channel and broke out with bullish momentum, marking a 12-month high near $25. The EMA ribbons form crossovers favoring the prices. With current price action occurring above the EMA ribbon, Silver Futures turn strongly bullish. 

The rising price of Silver Futures seems to face rejection at $25.380, after which it forms a retracement pattern. The RSI reaches the overbought zone, indicating a temporary price reversal and overwhelmed buyers of Silver. The MACD widely diverges forming a positive cross and recording ascending buyer bars. The indicators suggest a hyper-bullish market and hint at a trend reversal.

Conclusion

Silver Futures is trading at $25 marking a 12-month high. The bullish breakout seems to be facing rejection at $25.830 and might be heading for a reversal. The bullish indicators appropriately fail to give reversal signals. The factors that sent Silver shooting up could be Fed’s plans on slowing rate hikes. Other reasons could be the weak US Dollar Index and increased demand of Silver for industrial usage. The returning price of Silver may test the support near $23.505.

Technical levels

Support levels: $23.505 and $20.110

Resistance levels: $25.380 and $26.925

Disclaimer

The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss. 

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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