- Silver price trades within a narrow range as investors await the release of the US PCE inflation data for November.
- The Federal Reserve’s recent signal of fewer interest rate cuts for the upcoming year has supported the US Dollar and bond yields, adding downward pressure on precious metals.
Silver price (XAG/USD) remains in a narrow range around $29.00 during Friday’s European session, as investors await the US core Personal Consumption Expenditure (PCE) data for November, scheduled for release at 13:30 GMT. Economists predict a slight increase in annual core PCE inflation to 2.9% from 2.8% in October, with a steady month-over-month growth of 0.2%. Any significant slowdown in price pressures could dampen expectations for the Federal Reserve’s policy stance, but a continued or accelerated inflationary trend would likely support a more hawkish outlook.
In its recent policy meeting, the Fed lowered key borrowing rates by 25 basis points (bps) to 4.25%-4.50%, signaling fewer rate cuts for 2025. The Fed’s updated dot plot now sees Federal Fund rates at 3.9% by 2025, up from the 3.4% previously projected. Ahead of the PCE data, the US Dollar Index (DXY) has eased from its two-year high at 108.50, while 10-year US Treasury yields have dipped to 4.56% from a six-month peak of 4.60%. This pullback in yields slightly reduces the opportunity cost of holding non-yielding assets like silver.
Sliver technical analysis
From a technical perspective, silver has dropped below its 200-day Exponential Moving Average (EMA) at $29.35 and broken the upward-sloping trendline around $30.20, which had been in place since February 29. The 14-day Relative Strength Index (RSI) has entered the bearish zone between 20.00-40.00, signaling further downside momentum. Key support for silver lies near the September low of $27.75, while the 50-day EMA around $30.90 serves as resistance.
Silver daily chart
