Support the Wall Street Examiner! Choose your level of support to receive a free proprietary report as my thanks. Click the button below to see your options. Become a Patron!

The Price of Silver Could Pop Following the December FOMC Meeting

This is a syndicated repost courtesy of Money Morning. To view original, click here. Reposted with permission.

After a week that saw the price of silver struggle to notch any gains, its most recent trading day made up for its latest challenge.

Liquidity moves markets!

Follow the money. Find the profits! 

The Buenos Aires G-20 meetings provided for the spark that silver prices needed to rally.

Washington and Beijing announced a “90-day truce” in their trade war, whereby both sides have promised not to escalate tariffs any further as they work diligently to resolve their disputes.

silver priceThat clearly took buying pressure away from the dollar, allowing broad-based gains for commodities, with silver being no exception.

The metal jumped nearly 2% on Monday, joining gold, oil, base metals, and general equities.

Silver prices will now look forward to the Fed’s expected December rate hike, which could provide another catalyst for the metal to rally higher.

Before we look at how the FOMC meeting will impact the price of silver, here’s how the metal is moving now…

A Closer Look at the Movement in the Price of Silver

The silver price initially popped on Tuesday, Nov. 27, to touch the $14.40 level before selling off to bottom at $14.06 near 1 p.m. That damage came as the U.S. dollar index (DXY) reacted, running up to 97.35 as Fed Vice Chair Richard Clarida said the Fed should continue to raise rates gradually while monitoring new economic data.

Billions Are Now in Play: Millions of Americans could collect “Federal Rent Checks” – to learn how to claim your portion of an $11.1 billion money pool using this backdoor investment, click here now

However, the metal would regain nearly all that ground on Wednesday, as Fed Chair Powell suggested interest rates were just under the estimates of where they needed to be for a neutral level for the economy. On those words, seen as more dovish than his previous comments, the dollar index dropped in dramatic fashion from 97.5 to 96.5. That boosted silver from $14.15 to $14.35 within minutes.

On Thursday, silver basically moved sideways as the DXY consolidated.

Here’s the dollar index’s action for the past trading week:


The workweek ended Friday with renewed DXY strength pulling the index up to 97.25 as investors eyed the G-20 meeting that would take place the next day. That midday dollar rally pushed silver down to bottom at $14.02 before it clawed its way back to close at $14.15.

But Monday’s action was very bullish as a new China-U.S. trade truce took some froth off the DXY, allowing silver to rally as high at $14.55 just after 9 a.m. It then worked off some of those gains, though still traded at $14.40 by 2 p.m.

Now that we’ve seen how the price of silver is moving now, here’s how I expect the precious metal to move as we head toward 2019…

What’s Next for Silver Prices Ahead of 2019

Now that there’s a truce between Washington and Beijing, the case for a weaker dollar has been bolstered.

I say that because the dollar was being bought as a safe haven as investors hedged against the risk of escalating trade wars. At this point, even if there is a new escalation, it’s likely not going to happen for months thanks to the recent cease-fire.

silver today

In the meantime, we can see that the dollar’s new trend, though mild still for now, is clearly downward. And we have technical confirmation of this through the RSI and MACD momentum indicators.

I think the bias for the general markets will now be upward, drawing capital away from the dollar and into stocks as well as precious metals.

Despite its latest rally on the weaker dollar, silver still has to show more strength to prove itself.

price of silver 2019

Silver is now back at its 50-day moving average, but just barely. That still leaves it within its range of $14 to $14.75.

Now it needs to remain above $14.50, then clear $14.75. After that, I see $15.50 as the next target.

And we may be seeing things turn in the physical markets in the meantime.

The U.S. Mint’s latest sales numbers show November 1-oz. silver coins sales at 1.645 million. That’s 15% higher than October, a sign of bargain buying.

Walsh Trading’s John Weyer, co-director of commercial hedging, thinks the latest thaw in trade negotiations has caused investors to recognize the value inherent in silver at current prices.

I would have to agree with that assessment. And I think December will continue to see silver prices well supported.


To get full access to all Money Morning content, click here

About Money Morning: Money Morning gives you access to a team of ten market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and visitors become smarter, more confident investors.

Disclaimer: © 2018 Money Morning and Money Map Press. All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning. 16 W. Madison St. Baltimore, MD, 21201.

The post The Price of Silver Could Pop Following the December FOMC Meeting appeared first on Money Morning – We Make Investing Profitable.

Wall Street Examiner Disclosure:Lee Adler, The Wall Street Examiner reposts third party content with the permission of the publisher. I curate posts here on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. Some of the content includes the original publisher's promotional messages. I may receive promotional consideration on a contingent basis, when paid subscriptions result. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler, unless authored by me, under my byline. No endorsement of third party content is either expressed or implied by posting the content. Do your own due diligence when considering the offerings of information providers.

Try Lee Adler's Technical Trader risk free for 90 days! Follow the money. Find the profits!

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.