Keep in mind that the Federal Reserve has softened its stance recently, and that will be one of the biggest drivers of precious metals going forward. I believe at this point we will continue to see a lot of noise, because quite frankly it is a very confused and disturbed world we live in when it comes to global politics and of course economics. While the Americans and Chinese are starting to negotiate again, there is still a lot of concerns when it comes to how these two nations will interact with each other, as they are so massive when it comes to global growth. With this in mind, it’s crucial to think that there is some type of agreement coming. Once we get it, that should put a little bit more of a risk appetite situation out there, perhaps driving Silver higher as the US dollar should get sold off. In general, I believe that silver is going higher because of geopolitical concerns as well, so we may be in a situation where either outcome helps.
With the Federal Reserve softening its stance as of late, it makes sense that we continue to see a lot of pressure in the precious metals markets to go higher. I would point out though that the $16 level above will continue to cause a lot of headaches, so expect a grind higher. The 20 day EMA below, the green moving average on the chart, will continue to offer support as well.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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