Silver Prices Fall Amid Focus on Russia-Ukraine Conflict and FOMC Meeting
Key Insights
- Silver prices decrease ahead of hopes of de-escalated tensions
- The Dollar bounced slightly
- U.S. Benchmark Treasury yields moved lower
- Gold prices decline amid Russia-Ukraine ceasefire talks
Silver prices dipped on Tuesday as hopes of reduced geopolitical tensions reduced demand for safe-haven assets. U.S. benchmark yields slide ahead of the FOMC meeting tomorrow. Gold prices fall as its safe-haven appeal declines due to ceasefire talks between Russia and Ukraine. U.S. stocks rose while oil prices tumbled. Investors’ focus remains on the FOMC meeting tomorrow, including the rate hike, the pace of balance sheet unwinding, and inflation forecasts.
U.S. producer prices for February increased by 10% from a year ago. The producer price index (PPI), which tracks inflation before reaching consumers, climbed 0.8%. Mounting inflation pressures following the pandemic and the current geopolitical tensions lead to higher producer prices.
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Technical Analysis
Silver prices moved lower for the third consecutive trading session. The pattern could be a consolidation pattern that refreshes lower. De-escalated tensions will reduce demand and lower costs. The risk is to the downside. Support is near the 200-day moving average near 24.036. Resistance is now former support is near the 10-day moving average that comes in near $25.64. Short-term momentum is negative as the fast stochastic had a crossover sell signal.
The medium-term momentum is negative as the histogram prints negatively with the MACD (moving average convergence divergence). The trajectory of the MACD histogram is in negative territory, which reflects the downward trend in price movement.